Examining governance and performance of utility companies after mergers: a case from a municipal water company in Greece


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This study deals with the governance and performance of utility companies following mergers in local government organizations (LGOs). It is demonstrated by using the municipal water supply and sewerage company in city of Serres as a case study of how the reform initiative known as “Kallikratis” has impacted Greek municipal water and sewerage companies. As a result of the Kallikratis Program, the municipalities were merged, and new data were added to the map of local government in Greece. The methodological approach entails surveying the economic analysis of raw data using a number of financial ratios (financial statements of the municipal company). The study’s findings demonstrate that the municipal company of Serres was able to plan the actions that resulted in an improvement of the majority of the examined ratios after merger events, despite the extra responsibilities and geographic areas that the Kallikratis Program added to the municipal companies and the reduction of the extraordinary subsidies as a result of the Greek debt crisis. Eleven of the fourteen ratios perform better than they did before the merger, while three of them actually perform worse (2011–2018). However, various and contradictory results about the evolution of these ratios are seen over the crisis era, as some of them initially show a partial improvement (in the midst of the economic crisis period), but then they gradually deteriorate by the end of the crisis.

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    • Table 1. Financial ratios
    • Table 2. Descriptive statistics
    • Table 3. Comparison of financial ratios in the pre- and post-merger period
    • Table 4. Comparison of financial ratios in the economic crisis periods
    • Formal Analysis
      Michail Pazarskis, Sofia Kourtesi
    • Project administration
      Michail Pazarskis, Sofia Kourtesi
    • Supervision
      Michail Pazarskis, Sofia Kourtesi
    • Validation
      Michail Pazarskis
    • Conceptualization
      Stergios Galanis
    • Data curation
      Stergios Galanis, Maria Gkatziou
    • Methodology
      Stergios Galanis
    • Writing – review & editing
      Stergios Galanis, Sofia Kourtesi
    • Investigation
      Maria Gkatziou
    • Resources
      Maria Gkatziou
    • Writing – original draft
      Maria Gkatziou