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Author: Stefano Clò
Publisher:
ISBN:
Category :
Languages : en
Pages : 38
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Book Description
Despite a wave of privatizations in the past three decades, several governments own major corporations in industries such as energy, mining, telecommunications, transport, banking, manufacturing, in emerging economies as well as in some developed ones. Contemporary state-owned enterprises (SOEs) are increasingly active players in the international and domestic markets for corporate control, through mergers and acquisitions. This paper contributes to a new strand of literature on SOEs form the angle of the market for corporate control. Do the SOEs, behave as their private counterparts when purchasing other firms? The standard prediction of the “inefficient management hypothesis” is that firms that perform well will buy firms of inferior managerial quality (Manne, 1965). An alternative prediction is offered more recently by Rhodes-Kropf and Robinson (2008), who suggest that for US listed companies “like buys like”. To test both the alternative views and the research question on how public ownership has an impact on the market for corporate control, we build a new dataset from Zephyr and Orbis, two databases developed by the Bureau Van Dijk since early 2000s. Our sample is composed by 25,332 deals worldwide, of which around 10% are performed by a SOE acquirer. By focusing on the difference of the return on sales between the acquirer and the target firm, and controlling for different factors, we find that the Rhodes-Kropf and Robinson (2008) prediction is more likely for listed companies, but not for the others; SOEs tend to buy “lower” relative to their own performance than private companies do, while their behavior converges towards the private benchmark when the SOEs are listed. We conclude that mergers and acquisitions by SOEs in the years we consider are not as much at variance with the “inefficient market hypothesis” as private firms.
Author: Stefano Clò
Publisher:
ISBN:
Category :
Languages : en
Pages : 38
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Book Description
Despite a wave of privatizations in the past three decades, several governments own major corporations in industries such as energy, mining, telecommunications, transport, banking, manufacturing, in emerging economies as well as in some developed ones. Contemporary state-owned enterprises (SOEs) are increasingly active players in the international and domestic markets for corporate control, through mergers and acquisitions. This paper contributes to a new strand of literature on SOEs form the angle of the market for corporate control. Do the SOEs, behave as their private counterparts when purchasing other firms? The standard prediction of the “inefficient management hypothesis” is that firms that perform well will buy firms of inferior managerial quality (Manne, 1965). An alternative prediction is offered more recently by Rhodes-Kropf and Robinson (2008), who suggest that for US listed companies “like buys like”. To test both the alternative views and the research question on how public ownership has an impact on the market for corporate control, we build a new dataset from Zephyr and Orbis, two databases developed by the Bureau Van Dijk since early 2000s. Our sample is composed by 25,332 deals worldwide, of which around 10% are performed by a SOE acquirer. By focusing on the difference of the return on sales between the acquirer and the target firm, and controlling for different factors, we find that the Rhodes-Kropf and Robinson (2008) prediction is more likely for listed companies, but not for the others; SOEs tend to buy “lower” relative to their own performance than private companies do, while their behavior converges towards the private benchmark when the SOEs are listed. We conclude that mergers and acquisitions by SOEs in the years we consider are not as much at variance with the “inefficient market hypothesis” as private firms.
Author: Fred S. McChesney
Publisher: Edward Elgar Publishing
ISBN: 9781849801362
Category : Consolidation and merger of corporations
Languages : en
Pages : 0
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Book Description
This volume provides an essential overview of one of the most important developments in economics, finance and law of the past generation: the growing realization of how the market for corporate control functions and why its operation is of crucial importance. Presenting seventeen seminal contributions, the book illustrates the importance of corporate control changes - mergers, acquisitions and other takeovers - in helping to align the interests of corporate shareholders and their managers. The mechanics of various takeover techniques (poison pills, greenmail and other gambits) are also explored alongside empirical research concerning the functioning of the market for corporate control.
Author: Hoang N. Pham
Publisher: Routledge
ISBN: 1000540278
Category : Business & Economics
Languages : en
Pages : 190
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Book Description
The relationship between ownership structure and firm performance has been studied extensively in corporate finance and corporate governance literature. Nevertheless, the mediation (path) analysis to examine the issue can be adopted as a new approach to explain why and how ownership structure is related to firm performance and vice versa. This approach calls for full recognition of the roles of agency costs and corporate risk-taking as essential mediating variables in the bi-directional and mediated relationship between ownership structure and firm performance. Based on the agency theory, corporate risk management theory and accounting for the dynamic endogeneity in the ownership–performance relationship, this book develops two-mediator mediation models, including recursive and non-recursive mediation models, to investigate the ownership structure–firm performance relationship. It is demonstrated that agency costs and corporate risk-taking are the ‘missing links’ in the ownership structure–firm performance relationship. Hence, this book brings into attention the mediation and dynamic approach to this issue and enhances the knowledge of the mechanisms for improving firm’s financial performance. This book will be of interest to corporate finance, management and economics researchers and policy makers. Post-graduate research students in corporate governance and corporate finance will also find this book beneficial to the application of econometrics into multi-dimensional and complex issues of the firm, including ownership structure, agency problems, corporate risk management and financial performance.
Author: Katinka Wölfer
Publisher: Peter Lang Gmbh, Internationaler Verlag Der Wissenschaften
ISBN: 9783653062755
Category : Business & Economics
Languages : en
Pages : 0
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Book Description
The book illustrates that the impact of ownership on firm value depends not only on the concentration of ownership but also on the identity of blockholders. Large shareholders can use their power to influence corporate performance. However, owners are no homogenous group and have different motivations and abilities.
Author: Xiaonian Xu
Publisher: World Bank Publications
ISBN:
Category : Corporate governance
Languages : en
Pages : 60
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Book Description
Author: Bengi Ozer
Publisher:
ISBN:
Category :
Languages : en
Pages : 16
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Book Description
The evidence of highly concentrated ownership structure in companies that have exposed themselves to market discipline illustrates a confusing structure of corporate governance. The disciplinary effect of the market is questioned in a context with concentrated ownership structure and poor investor protection. We explore whether the presence and magnitude of market control leads to differences in performance in the case of concentrated ownership structure. We explore how the presence and the magnitude of widely held ownership influence the different dimensions of performance in companies with concentrated ownership. We further investigate whether the differences in the identity of the controlling shareholder influences impact of market control on the performance of these firms. Companies trading in the Istanbul Stock Exchange as of 1999 constitute the sample of the study. The findings indicate the presence of a highly concentrated ownership structure in the Turkish market. The results of the regression analyses seem to indicate that the market control (dispersed ownership percentage) influences certain dimensions of performance but not in the expected direction. Market control does not seem to have any disciplinary effects on performance in concentrated companies. Identity of the controlling shareholder seems to have a profound effect on the performance. Controlling shareholders types that operate through a portfolio of other companies seem to have favorable influence on performance. Significant relationship between debt pressure and performance might be indicating the disciplinary pressure of the debt holders. The findings imply a potential disciplinary impact of stakeholders rather than shareholders or market. The study also provides supportive evidence for the impact of context on the relation between ownership and performance.
Author: Luc Laeven
Publisher: International Monetary Fund
ISBN:
Category : Business & Economics
Languages : en
Pages : 44
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Book Description
The bulk of corporate governance theory examines the agency problems that arise from two extreme ownership structures: 100 percent small shareholders or one large, controlling owner combined with small shareholders. In this paper, we question the empirical validity of this dichotomy. In fact, one-third of publicly listed firms in Europe have multiple large owners, and the market value of firms with multiple blockholders differs from firms with a single large owner and from widely-held firms. Moreover, the relationship between corporate valuations and the distribution of cash-flow rights across multiple large owners is consistent with the predictions of recent theoretical models.
Author: Michael L. Lawriwsky
Publisher: London : Croom Helm ; New York : St. Martin's Press
ISBN: 9780312170011
Category : Business & Economics
Languages : en
Pages : 286
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Book Description
This stimulating and impressively argued book examines the many issues connected with corporate structure and performance.It reviews the existing literature on the subject and discusses the results of a massive research project carried out over a ten year period using data from 226 corporations. The issues are discussed in relation to corporations in Australia, Britain, Western Europe and the United States.
Author: Donald H. Chew
Publisher: Columbia University Press
ISBN: 9780231519984
Category : Business & Economics
Languages : en
Pages : 388
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Book Description
Corporate governance constitutes the internal and external institutions, markets, policies, and processes designed to help companies maximize their efficiency and value. In this collection of classic and current articles from the Journal of Applied Corporate Finance, thought leaders such as Michael Jensen and Robert Monks discuss the corporate mission of value maximization and the accomplishments and limitations of the U.S. governance system in achieving that end. Essays address the elements driving corporate value: the board of directors, compensation for CEOs and other employees, incentives and organizational structure, external ownership and control, role of markets, and financial reporting. They evaluate best practice methods, challenges in designing equity plans, transferable stock options, the controversy over executive compensation, the values of decentralization, identifying and attracting the "right" investors, the evolution of shareholder activism, creating value through mergers and acquisitions, and the benefits of just saying no to Wall Street's "earnings game." Grounded in solid research and practice, U.S. Corporate Governance is a crucial companion for navigating the world of modern finance.
Author: Adolf Augustus Berle
Publisher:
ISBN:
Category : Corporation law
Languages : en
Pages : 396
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Book Description
