Abstract
This article investigates the importance of mergers in the public sector , analysing the case of T oscana Energia—a gas supplier in Italy. T oscana Energia was formed by merging three entities. There was no improvement in financial performance after the merger. Realistic merger benefits include competitive gains and, in this case, a better deal for consumers. P oliticians under pressure to merge should insist on the public sector being the majority owner in utilities. The best merger outcomes are of smaller municipal enterprises.
Acknowledgments
The authors would like to thank this journal's two anonymous referees and Public Money & Management's editor for their helpful comments and suggestions. This study was carried out with the financial support of the Spanish National R&D Plan through research project ECO2010-17463 (ECON FEDER).