Abstract

This study aims to identify the reasons that led credit unions in the State of Minas Gerais, Brazil, to carry out processes of incorporation, based on the motives included in the theory of the firm and the agency theory: asymmetrical expectations, compensation and tax incentives, replacement costs and market values, seek for economies of scale, anticompetitive effects and pursuit of monopoly power and reducing the risk of insolvency. We investigated four credit unions that have undergone processes of mergers from 2008 to 2011, by interviewing six managers who participated in the processes of incorporation. Compensation and tax incentives, anticompetitive effects and pursuit of monopoly power were not motivating factors, but we identified the seek for economies of scale as a motivation in all the cooperatives studied. We observed that the cooperative has an organizational structure distinct from other kinds of business, but there is a similarity in their merging processes, because the underlying reasons inserted in the theory of the firm and the agency theory were identified as triggers for the mergers.

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