Voluntary Dual Class Share Unifications-a Mixed Bag of Governance Improvements and Shareholder Expropriation

B. Lauterbach, Anete Pajuste

Research output: Contribution to conferencePaperpeer-review

Abstract

We study 121 voluntary dual class share unification in Europe during 1996-2009, and uncover a mixed tale of governance improvements and shareholder expropriation. Corporate governance improvement is attained by abolishing the wedge between ownership and voting rights and by significantly decreasing controlling shareholders' voting power. Shareholder expropriation occurs when some controlling shareholders exploit the unification hype to sell part or all of their holdings at inflated prices. On average, the corporate governance positive valuation effects prevail, and voluntary unifications are accompanied by a statistically and economically significant increase of Q.
Original languageAmerican English
StatePublished - 2014
EventEuropean Financial Management Association - Rome, Italy
Duration: 25 Jun 201428 Jun 2014

Conference

ConferenceEuropean Financial Management Association
Country/TerritoryItaly
CityRome
Period25/06/1428/06/14

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