Blockholder dispersion and firm value

This paper analyzes the impact of blockownership dispersion on firm value. Blockholdings by multiple blockholders is a widespread phenomenon in the U.S. market. It is not clear, however, whether dispersion among blockhol
This paper analyzes the impact of blockownership dispersion on firm value. Blockholdings by multiple blockholders is a widespread phenomenon in the U.S. market. It is not clear, however, whether dispersion among blockholder is preferable to having a more concentrated ownership structure. To test for the direction of the effect, we use a large dataset of U.S. firms that combines blockholder information, shareholder rights information, debt ratings, accounting information, and financial markets information. We find that a large fraction of aggregated block ownership negatively affects Tobin’s Q. The negative impact is larger if blockowners are more dispersed, suggesting that a concentrated ownership structure is to be preferred on average. Results are robust to controlling for blockholder type as well as proxies for shareholder rights. Our empirical findings are also confirmed if we study the impact of ownership dispersion on firm debt ratings rather than Tobin’s Q. JEL Classification: G3, G32 Keywords: Corporate Governance, Ownership Structure, Multiple Blockholders, Firm Value
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Metadaten
Author:Sander J. J. Konijn, Roman Kräussl, Andre Lucas
URN:urn:nbn:de:hebis:30-75241
Series (Serial Number):CFS working paper series (2010, 05)
Document Type:Working Paper
Language:English
Date of Publication (online):2010/02/25
Year of first Publication:2010
Publishing Institution:Univ.-Bibliothek Frankfurt am Main
Release Date:2010/02/25
Tag:Corporate Governance ; Firm Value; Multiple Blockholders ; Ownership Structure
HeBIS PPN:221647740
Institutes:Center for Financial Studies (CFS)
Dewey Decimal Classification:330 Wirtschaft
Sammlungen:Universitätspublikationen
Licence (German):License Logo Veröffentlichungsvertrag für Publikationen

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