Work

Complex Ownership Structures and Corporate Valuations

Year: 2006

Type: article

Abstract: The bulk of corporate governance theory examines the agency problems that arise from two extreme ownership structures: 100% 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.

Source: Review of Financial Studies

DOI: 10.1093/rfs/hhm068

Authors: Luc Laeven, Ross Levine

Institutions: Center for Economic and Policy Research, International Monetary Fund, National Bureau of Economic Research, Brown University

Language: English

Topic: Corporate Finance and Governance

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

Open Access status: bronze

Funder: World Bank Group

OpenAlex ID: W2889649708

FWCI: 62.4

Cites: 64

Cited by: 606

Related to: 10