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Corporate group

About: Corporate group is a research topic. Over the lifetime, 1747 publications have been published within this topic receiving 46868 citations.


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Journal ArticleDOI
01 Feb 1998
TL;DR: In this paper, the influence of CEO changes in big german companies on their financial statements two years prior and three years after the executive turnover has been examined and it is shown that conflicting results of prior research might be based on the lack of differing for turnover-reasons.
Abstract: This article examins the influence of CEO changes in big german companies on their financial statements two years prior and three years after the executive turnover. It is shown that conflicting results of prior research might be based on the lack of differing for turnover-reasons. Companies with unvoluntary changes of the CEO realize a different evolution of performance than companies with CEOs changing voluntarily or for reason like retirement or death. A closer examination of the “unvoluntary change-companies” reveals significant patterns of performance both over the years and in relation to a group of companies without an equivalent CEO-change. The data seems to prove that companies experience a so called “financial bath” in situations of unvoluntary CEO turnover.

4 citations

Journal ArticleDOI
TL;DR: In this paper, the authors investigated the effect of private benefits from control on investment decision processes in a capital constrained business group and found that the appropriation of control benefits may give rise to an increase in the market value of the group as well as in the portfolio wealth of the set of minority shareholders.
Abstract: This paper aims at developing a theoretical framework to address the issue of internal resource allocation within corporate groups, representing an extension of the internal capital market approach developed for Anglo-Saxon type multidivisional enterprises. In particular, the paper investigates how private benefits from control affect investment decision processes in a capital constrained business group. We consider a group of n listed companies controlled by one main shareholder (i.e., a hierarchical group), and suppose that the group as a whole is endowed with an exogenous and limited amount of capital for investment. We analyze the effects of private benefits on the investment allocative efficiency and on the wealth of the group';s various claimants. Under reasonable assumptions, we show that the controlling shareholder always finds preferable to secure private benefits. Moreover, and surprisingly enough, we find that the appropriation of control benefits may give rise to an increase in the market value of the group as well as in the portfolio wealth of the set of minority shareholders. In particular, the positive effect of control benefits on minority interests increases with the capital rationing of the group. Therefore, the effects of private benefits can be different in different markets, depending on the degree of development and the credit capacity of the single market. The findings of this paper challenge the largely accepted view that private benefits from control are always harmful to minority shareholders.

4 citations

Journal ArticleDOI
TL;DR: This paper found that affiliated firms underperform on organizational innovation more than stand-alone firms and that the main effect is strengthened when the business group size is large and the affiliated firm CEO's industrial experience level is low.

4 citations

Journal ArticleDOI
TL;DR: In this paper, the authors investigate the succession of controlling equity stake to next generation is an issue of paramount importance in family firms, and investigate this possibility using Korean chaebol firms during a sample period of 2000-2009.
Abstract: In family firms, the succession of controlling equity stake to next generation is an issue of paramount importance. This, however, can be a major challenge in the presence of heavy inheritance or gift tax burden (high tax rate and absence of tax-saving vehicles, such as trusts or foundations) and in the absence of dual-class equity. Such regulatory environment may lead families to seek alternative ways of succession. As for families controlling business groups, one way of doing so is making use of related-party transactions among member firms. By favoring firms where the heir holds significant equity stake, the family can tunnel corporate resources to the heir. Eventually, the firm can grow large enough to acquire controlling equity stakes in other firms within the group. In this paper, we investigate this possibility using Korean chaebol firms during a sample period of 2000-2009. We identify firms where heirs become a major shareholder (treatment group) and compare them against their year-industry-size-matched firms (control group) before and after the ownership change. Difference-in-differences test with firm fixed effects reveal that treatment group firms experience greater related-party transactions, benefit from them in terms of earnings, pay out more dividends, and become more important in controlling other firms in the group.

4 citations


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Performance
Metrics
No. of papers in the topic in previous years
YearPapers
202321
202249
202165
202078
201967
201874