The effect of corporate multinationalism on shareholders' wealth: evidence from international acquisitions

Article Abstract:

This study presents direct evidence on the effect of international acquisitions on stock prices of U.S. bidding firms. Shareholders of multinational corporations (MNCs) not operating in the target firm's country experience significant positive abnormal returns at the announcement of international acquisitions. Shareholders of U.S. firms expanding internationally for the first time experience insignificant positive abnormal returns, while shareholders of MNCs operating already in the target firm's country experience insignificant negative abnormal returns. The abnormal returns are larger when firms expand into new industry and geographic markets - especially those less developed than the U.S. economy. The evidence is consistent with the theory of corporate multinationalism, predicting an increase in the firms market value from the expansion of its existing multinational network. (Reprinted by permission of the publisher.)

Research, Analysis, Management, Conglomerate corporations, Acquisitions and mergers, International business enterprises, Multinational corporations, Developing countries, Diversification in industry, Industrial diversification, Investor relations

---

The effect of long-term performance plans on corporate sell-off-induced abnormal returns

Article Abstract:

This study examines the association between long-term performance plans and wealth effects accruing to stockholders of divesting firms at announcements of sell-off proposals. The results indicate that divesting companies with long-term performance plans experience a more favorable stock market reaction at the announcement of sell-off proposals relative to firms without long-term performance plans. The findings imply that long-term performance plans serve as an effective mechanism to motivate managers to make better decisions. (Reprinted by permission of the publisher.)

Economic aspects, Finance, Corporations, Corporate finance, Corporate divestiture, Divestiture

---

Similar abstracts:

• Abstracts: The moderating influence of strategic orientation on the strategy formation capability-performance relationship
• Abstracts: The psychological context of strategic decisions: a test of relevance to practitioners. Competencies and firm performance: examining the causal ambiguity paradox
• Abstracts: The limits of arbitrage. Liquidation values and debt capacity: a market equilibrium approach. Do managerial objectives drive bad acquisitions?
• Abstracts: The case for strategic management accounting: the role of accounting information for strategy in competitive markets
• Abstracts: Scope of commuting expenses broadened as a result of recent developments. Interest and property tax deductions on a vacation home: the allocation controversy

This website is not affiliated with document authors or copyright owners. This page is provided for informational purposes only. Unintentional errors are possible.