Change in Control and Firm Performance
| Autor: | Pei-Gi Shu, Yin-Hua Yeh |
|---|---|
| Rok vydání: | 2014 |
| Předmět: |
jel:Z0
Corporate Governance Change in Control Controlling Shareholder business.industry Corporate governance Control (management) Geology Accounting Monetary economics Geotechnical Engineering and Engineering Geology Shareholder Hardware and Architecture Cash flow Financial distress Business sense organs jel:R00 skin and connective tissue diseases |
| Zdroj: | Business and Economic Research. 4(2):265-296 |
| Popis: | Whether firms that experienced change in control perform better or worse than before the change remains a puzzling issue. In this study we investigate the firms that experienced change in control and find that poor performing firms tend to be the takeover targets; however, these firms performed even worse after change of control. We find that corporate governance dictates the post-change performance measures. The proportion of directors controlled by the controlling shareholder is negatively related to the post-change performance measures. In contrast, the proportion of directors controlled by the second controlling shareholder is positively related to the post-change performance measures. Furthermore, the performance measures of the targets improved when the controlling shareholder entitled high cash flow rights. Finally, the change-in-control firms are more likely to be trapped in financial distress when the controlling shareholders deeply involved in the board. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
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