Skip to main content

Tipp

Weitere Kapitel dieses Buchs durch Wischen aufrufen

2020 | OriginalPaper | Buchkapitel

Corporate Diversification-Performance Puzzle in BRIC

verfasst von : Svetlana Grigorieva

Erschienen in: Strategic Deals in Emerging Capital Markets

Verlag: Springer International Publishing

Aktivieren Sie unsere intelligente Suche um passende Fachinhalte oder Patente zu finden.

search-config
loading …

Abstract

Researchers have long tried to define the impact of corporate diversification on firm value. Academic papers mainly concentrate on the effects of corporate diversification in mature markets, while its consequences in emerging capital markets are less explored. This article presents the results of an empirical analysis of corporate diversification strategies of a sample of companies from BRIC countries that expanded via acquisitions during 2000–2013. We contribute to the existing literature by examining the effects of corporate diversification on firm value during the pre- and post-crisis periods. In line with other studies, we distinguish between related and unrelated diversification, and in contrast to them, we single out and separately analyze horizontal, conglomerate, and vertical acquisitions. Based on a sample of 319 deals initiated by companies from BRIC countries, we found positive (3.32% and 9.01%) and statistically significant cumulative abnormal returns for conglomerate acquisitions during the pre- and post-crisis periods, correspondingly. We also found that the market reacts positively and statistically significantly to the announcements of horizontal and vertical integration only during the pre-crisis period.

Sie haben noch keine Lizenz? Dann Informieren Sie sich jetzt über unsere Produkte:

Springer Professional "Wirtschaft+Technik"

Online-Abonnement

Mit Springer Professional "Wirtschaft+Technik" erhalten Sie Zugriff auf:

  • über 102.000 Bücher
  • über 537 Zeitschriften

aus folgenden Fachgebieten:

  • Automobil + Motoren
  • Bauwesen + Immobilien
  • Business IT + Informatik
  • Elektrotechnik + Elektronik
  • Energie + Nachhaltigkeit
  • Finance + Banking
  • Management + Führung
  • Marketing + Vertrieb
  • Maschinenbau + Werkstoffe
  • Versicherung + Risiko

Jetzt Wissensvorsprung sichern!

Springer Professional "Wirtschaft"

Online-Abonnement

Mit Springer Professional "Wirtschaft" erhalten Sie Zugriff auf:

  • über 67.000 Bücher
  • über 340 Zeitschriften

aus folgenden Fachgebieten:

  • Bauwesen + Immobilien
  • Business IT + Informatik
  • Finance + Banking
  • Management + Führung
  • Marketing + Vertrieb
  • Versicherung + Risiko




Jetzt Wissensvorsprung sichern!

Literatur
Zurück zum Zitat Andres, P., Fuente, G., & Velasco, P. (2014). Growth opportunities and the effect of corporate diversification on value. The Spanish Review of Financial Economics, 12(2), 73–81. CrossRef Andres, P., Fuente, G., & Velasco, P. (2014). Growth opportunities and the effect of corporate diversification on value. The Spanish Review of Financial Economics, 12(2), 73–81. CrossRef
Zurück zum Zitat Bae, K. H., Kang, J. K., & Kim, J. M. (2002). Tunneling or valued added: Evidence from mergers by Korean business groups. Journal of Finance, 57(6), 2695–2740. CrossRef Bae, K. H., Kang, J. K., & Kim, J. M. (2002). Tunneling or valued added: Evidence from mergers by Korean business groups. Journal of Finance, 57(6), 2695–2740. CrossRef
Zurück zum Zitat Benito-Osorio, D., Guerras-Martín, L. A., & Zuniga-Vicente, J. A. (2012). Four decades of research on product diversification: A literature review. Management Decision, 50(2), 325–344. CrossRef Benito-Osorio, D., Guerras-Martín, L. A., & Zuniga-Vicente, J. A. (2012). Four decades of research on product diversification: A literature review. Management Decision, 50(2), 325–344. CrossRef
Zurück zum Zitat Berger, P. G., & Ofek, E. (1995). Diversification’s effect on firm value. Journal of Financial Economics, 37, 39–65. CrossRef Berger, P. G., & Ofek, E. (1995). Diversification’s effect on firm value. Journal of Financial Economics, 37, 39–65. CrossRef
Zurück zum Zitat Bertrand, M., Mehta, P., & Mullainathan, S. (2002). Ferreting out tunneling: An application to Indian business groups. Quarterly Journal of Economics, 117(1), 121–148. CrossRef Bertrand, M., Mehta, P., & Mullainathan, S. (2002). Ferreting out tunneling: An application to Indian business groups. Quarterly Journal of Economics, 117(1), 121–148. CrossRef
Zurück zum Zitat Brusco, S., & Panunzi, F. (2005). Reallocation of corporate resources and managerial incentives in internal capital markets. European Economic Review, 49(3), 659–681. CrossRef Brusco, S., & Panunzi, F. (2005). Reallocation of corporate resources and managerial incentives in internal capital markets. European Economic Review, 49(3), 659–681. CrossRef
Zurück zum Zitat Campa, J. M., & Kedia, S. (2002). Explaining the diversification discount. Journal of Finance, LVII(4), 1731–1762. CrossRef Campa, J. M., & Kedia, S. (2002). Explaining the diversification discount. Journal of Finance, LVII(4), 1731–1762. CrossRef
Zurück zum Zitat Caudillo, F., Houben, S., & Noor, J. (2015). Mapping the value of diversification. McKinsey on Finance, 55, 10–12. Caudillo, F., Houben, S., & Noor, J. (2015). Mapping the value of diversification. McKinsey on Finance, 55, 10–12.
Zurück zum Zitat Claessen, S., Djankov, S., Fan, J., & Lang, L. (2001). The pattern and valuation effects of corporate diversification: A comparison of the US, Japan, and Other East Asian economies. World institute for development economics research (Discussion chapter. № 2001/127). Claessen, S., Djankov, S., Fan, J., & Lang, L. (2001). The pattern and valuation effects of corporate diversification: A comparison of the US, Japan, and Other East Asian economies. World institute for development economics research (Discussion chapter. № 2001/127).
Zurück zum Zitat Claessen, S., Fan, J., & Lang, L. (2006). The benefits and costs of group affiliation: Evidence from East Asia. Emerging Markets Review, 7, 1–26. CrossRef Claessen, S., Fan, J., & Lang, L. (2006). The benefits and costs of group affiliation: Evidence from East Asia. Emerging Markets Review, 7, 1–26. CrossRef
Zurück zum Zitat Dastidar, P. (2009). International corporate diversification and performance: Does firm self-selection matter? Journal of International Business Studies, 40, 71–85. CrossRef Dastidar, P. (2009). International corporate diversification and performance: Does firm self-selection matter? Journal of International Business Studies, 40, 71–85. CrossRef
Zurück zum Zitat Denis, D. J., Denis, D. K., & Sarin, A. (1997). Agency problems, equity ownership and corporate diversification. Journal of Finance, 52, 135–160. CrossRef Denis, D. J., Denis, D. K., & Sarin, A. (1997). Agency problems, equity ownership and corporate diversification. Journal of Finance, 52, 135–160. CrossRef
Zurück zum Zitat Dess, G. G., Gupta, A., Hennart, J. F., & Hill, C. W. L. (1995). Conducting and integrating strategy research at the international, corporate and business levels: Issues and directions. Journal of Management, 21(3), 357–393. CrossRef Dess, G. G., Gupta, A., Hennart, J. F., & Hill, C. W. L. (1995). Conducting and integrating strategy research at the international, corporate and business levels: Issues and directions. Journal of Management, 21(3), 357–393. CrossRef
Zurück zum Zitat Erdorf, S., Hartmann-Wendels, T., Heinrichs, N., & Matz, M. (2013). Corporate diversification and firm value: A survey of recent literature. Financial Markets and Portfolio Management, 27(2), 187–215. CrossRef Erdorf, S., Hartmann-Wendels, T., Heinrichs, N., & Matz, M. (2013). Corporate diversification and firm value: A survey of recent literature. Financial Markets and Portfolio Management, 27(2), 187–215. CrossRef
Zurück zum Zitat Fan, J., & Lang, L. (2000). The measurement of relatedness: An application to corporate diversification. Journal of Business, 73(4), 629–660. CrossRef Fan, J., & Lang, L. (2000). The measurement of relatedness: An application to corporate diversification. Journal of Business, 73(4), 629–660. CrossRef
Zurück zum Zitat Fauver, L., Houston, J., & Naranjo, A. (2003). Capital market development, international integration, legal systems and the value of corporate diversification: A cross-country analysis. Journal of Finance and Quantitative Analysis, 38(1), 135–157. CrossRef Fauver, L., Houston, J., & Naranjo, A. (2003). Capital market development, international integration, legal systems and the value of corporate diversification: A cross-country analysis. Journal of Finance and Quantitative Analysis, 38(1), 135–157. CrossRef
Zurück zum Zitat Fukui, Y., & Ushijima, T. (2007). Corporate diversification, performance and restructuring in the largest Japanese manufacturers. Journal of the Japanese and International Economics, 21(3), 303–323. CrossRef Fukui, Y., & Ushijima, T. (2007). Corporate diversification, performance and restructuring in the largest Japanese manufacturers. Journal of the Japanese and International Economics, 21(3), 303–323. CrossRef
Zurück zum Zitat Galvan, A., Pindado, J., & Torre, C. (2007). Diversification: Value-creating or value-destroying strategy? Evidence from using panel data (Working Chapter No. DT04/07). Galvan, A., Pindado, J., & Torre, C. (2007). Diversification: Value-creating or value-destroying strategy? Evidence from using panel data (Working Chapter No. DT04/07).
Zurück zum Zitat Gautier, A., & Heider, F. (2009). The benefits and costs of winner-picking: Redistribution vs. incentives. Journal of Institutional and Theoretical Economics, 165, 622–649. CrossRef Gautier, A., & Heider, F. (2009). The benefits and costs of winner-picking: Redistribution vs. incentives. Journal of Institutional and Theoretical Economics, 165, 622–649. CrossRef
Zurück zum Zitat George, R., & Kabir, R. (2012). Heterogeneity in business groups and the corporate diversification firm performance relationship. Journal of Business Research, 65(3), 412–420. CrossRef George, R., & Kabir, R. (2012). Heterogeneity in business groups and the corporate diversification firm performance relationship. Journal of Business Research, 65(3), 412–420. CrossRef
Zurück zum Zitat Glegg, C., Harris, O., & Buckley, W. (2010). When does diversification add value: Evidence from corporate governance and abnormal long-term stock performance. Corporate Ownership & Control, 7(3), 325–342. CrossRef Glegg, C., Harris, O., & Buckley, W. (2010). When does diversification add value: Evidence from corporate governance and abnormal long-term stock performance. Corporate Ownership & Control, 7(3), 325–342. CrossRef
Zurück zum Zitat Graham, J. R., Lemmon, M. L., & Wolf, J. G. (2002). Does corporate diversification destroy value? The Journal of Finance, LVII(2), 695–719. CrossRef Graham, J. R., Lemmon, M. L., & Wolf, J. G. (2002). Does corporate diversification destroy value? The Journal of Finance, LVII(2), 695–719. CrossRef
Zurück zum Zitat Grigorieva, S. (2010). Empirical research of corporate diversification strategy in developed and emerging markets: An overview. Journal of Corporate Finance Research, 1(1), 111–144. Grigorieva, S. (2010). Empirical research of corporate diversification strategy in developed and emerging markets: An overview. Journal of Corporate Finance Research, 1(1), 111–144.
Zurück zum Zitat Inderst, R., & Laux, C. (2005). Incentives in internal capital markets: Capital constraints, competition, and investment opportunities. RAND Journal of Economics, 36(1), 215–228. Inderst, R., & Laux, C. (2005). Incentives in internal capital markets: Capital constraints, competition, and investment opportunities. RAND Journal of Economics, 36(1), 215–228.
Zurück zum Zitat Ivashkovskaya, I., & Shamraeva (Grigorieva), S. (2009). Corporate diversification effect on firm value in emerging markets: Evidence from BRIC countries. Global business and technological association. 11th international conference. Readings book. Business strategies and technological innovations for sustainable development: Creating global prosperity for humanity (pp. 565–571). – Edited by N. Delener. New York. Ivashkovskaya, I., & Shamraeva (Grigorieva), S. (2009). Corporate diversification effect on firm value in emerging markets: Evidence from BRIC countries. Global business and technological association. 11th international conference. Readings book. Business strategies and technological innovations for sustainable development: Creating global prosperity for humanity (pp. 565–571). – Edited by N. Delener. New York.
Zurück zum Zitat Khanna, T., & Palepu, K. (1997). Why focused strategies may be wrong for emerging markets. Harvard Business Review, 75(4), 41–51. Khanna, T., & Palepu, K. (1997). Why focused strategies may be wrong for emerging markets. Harvard Business Review, 75(4), 41–51.
Zurück zum Zitat Khanna, T., & Palepu, K. (2000a). Is group affiliation profitable in emerging markets? An analysis of diversified Indian business groups. The Journal of Finance, LV(2), 867–889. CrossRef Khanna, T., & Palepu, K. (2000a). Is group affiliation profitable in emerging markets? An analysis of diversified Indian business groups. The Journal of Finance, LV(2), 867–889. CrossRef
Zurück zum Zitat Khanna, T., & Palepu, K. (2000b). The future of business groups in emerging markets: Long-run evidence from Chile. The Academy of Management Journal, 43(3), 268–285. Khanna, T., & Palepu, K. (2000b). The future of business groups in emerging markets: Long-run evidence from Chile. The Academy of Management Journal, 43(3), 268–285.
Zurück zum Zitat Kistruck, G. M., Qureshi, I., & Beamish, P. W. (2013). Geographic and product diversification in charitable organizations. Journal of Management, 39(2), 496–530. CrossRef Kistruck, G. M., Qureshi, I., & Beamish, P. W. (2013). Geographic and product diversification in charitable organizations. Journal of Management, 39(2), 496–530. CrossRef
Zurück zum Zitat Kothari, S. P., & Warner, J. B. (2007). Econometrics of event studies. In B. E. Eckbo (Ed.), Handbook of corporate finance (pp. 3–36). Amsterdam: Elsevier. CrossRef Kothari, S. P., & Warner, J. B. (2007). Econometrics of event studies. In B. E. Eckbo (Ed.), Handbook of corporate finance (pp. 3–36). Amsterdam: Elsevier. CrossRef
Zurück zum Zitat Kuppuswamy, V., Serafeim, G., & Villalonga, B. (2014). The effect of institutional factors on the value of corporate diversification. Advances in Strategic Management: Finance and Strategy, 32, 37–68. CrossRef Kuppuswamy, V., Serafeim, G., & Villalonga, B. (2014). The effect of institutional factors on the value of corporate diversification. Advances in Strategic Management: Finance and Strategy, 32, 37–68. CrossRef
Zurück zum Zitat Lang, L., & Stulz, R. (1994). Tobin’s q, corporate diversification, and firm performance. Journal of Political Economy, 102, 1248–1280. CrossRef Lang, L., & Stulz, R. (1994). Tobin’s q, corporate diversification, and firm performance. Journal of Political Economy, 102, 1248–1280. CrossRef
Zurück zum Zitat Lee, K., Peng, M., & Lee, K. (2008). From diversification premium to diversification discount during institutional transitions. Journal of World Business, 43, 47–65. CrossRef Lee, K., Peng, M., & Lee, K. (2008). From diversification premium to diversification discount during institutional transitions. Journal of World Business, 43, 47–65. CrossRef
Zurück zum Zitat Lins, K., & Servaes, H. (1999). International evidence on the value of corporate diversification. Journal of Finance, 54, 2215–2239. CrossRef Lins, K., & Servaes, H. (1999). International evidence on the value of corporate diversification. Journal of Finance, 54, 2215–2239. CrossRef
Zurück zum Zitat Lins, K., & Servaes, H. (2002). Is corporate diversification beneficial in emerging markets? Financial Management, 31, 5–31. CrossRef Lins, K., & Servaes, H. (2002). Is corporate diversification beneficial in emerging markets? Financial Management, 31, 5–31. CrossRef
Zurück zum Zitat Lu, Y., & Yao, J. (2006). Impact of state ownership and control mechanisms on the performance of group affiliated companies in China. Asia Pacific Journal of Management, 23, 485–503. CrossRef Lu, Y., & Yao, J. (2006). Impact of state ownership and control mechanisms on the performance of group affiliated companies in China. Asia Pacific Journal of Management, 23, 485–503. CrossRef
Zurück zum Zitat Pal, R., & Bohl, M. (2006). Discount or premium? New evidence on corporate diversification of UK firms (SSRN Working chapter). Pal, R., & Bohl, M. (2006). Discount or premium? New evidence on corporate diversification of UK firms (SSRN Working chapter).
Zurück zum Zitat Palich, L. E., Cardinal, L. B., & Miller, C. C. (2000). Curvilinearity in the diversification performance linkage: An examination of over three decades of research. Strategic Management Journal, 21(2), 155–174. CrossRef Palich, L. E., Cardinal, L. B., & Miller, C. C. (2000). Curvilinearity in the diversification performance linkage: An examination of over three decades of research. Strategic Management Journal, 21(2), 155–174. CrossRef
Zurück zum Zitat Peng, M. W., & Delios, A. (2006). What determines the scope of the firm over time and around the world? An Asia Pacific perspective. Asia Pacific Journal of Management, 23(4), 385–405. CrossRef Peng, M. W., & Delios, A. (2006). What determines the scope of the firm over time and around the world? An Asia Pacific perspective. Asia Pacific Journal of Management, 23(4), 385–405. CrossRef
Zurück zum Zitat Perotti, E., & Gelfer, C. (2001). Red barons or robber barons? Governance and Investment in Russian Financial-Industrial Groups. European Economic Review, 45(9), 1601–1617. CrossRef Perotti, E., & Gelfer, C. (2001). Red barons or robber barons? Governance and Investment in Russian Financial-Industrial Groups. European Economic Review, 45(9), 1601–1617. CrossRef
Zurück zum Zitat Rajan, R., Servaes, H., & Zingales, L. (2000). The cost of diversity: The diversification discount and inefficient investment. Journal of Finance, LV(1), 35–80. CrossRef Rajan, R., Servaes, H., & Zingales, L. (2000). The cost of diversity: The diversification discount and inefficient investment. Journal of Finance, LV(1), 35–80. CrossRef
Zurück zum Zitat Rudolph, C., & Schwetzler, B. (2013). Conglomerates on the rise again? A cross-regional study on the impact of the 2008–2009 financial crisis on the diversification discount. Journal of Corporate Finance, 22, 153–165. CrossRef Rudolph, C., & Schwetzler, B. (2013). Conglomerates on the rise again? A cross-regional study on the impact of the 2008–2009 financial crisis on the diversification discount. Journal of Corporate Finance, 22, 153–165. CrossRef
Zurück zum Zitat Scharfstein, D. S., & Stein, J. C. (2000). The dark side of internal capital markets: Divisional rent-seeking and inefficient investment. Journal of Finance, LV(6), 2537–2564. CrossRef Scharfstein, D. S., & Stein, J. C. (2000). The dark side of internal capital markets: Divisional rent-seeking and inefficient investment. Journal of Finance, LV(6), 2537–2564. CrossRef
Zurück zum Zitat Schoar, A. (2002). Effects of corporate diversification on productivity. The Journal of Finance, 57(6), 2379–2403. CrossRef Schoar, A. (2002). Effects of corporate diversification on productivity. The Journal of Finance, 57(6), 2379–2403. CrossRef
Zurück zum Zitat Sudarsanam, S. (2003). Creating value from mergers and acquisitions: The challenges, an international and integrated perspective (p. 613). London: FT Prentice Hall. Sudarsanam, S. (2003). Creating value from mergers and acquisitions: The challenges, an international and integrated perspective (p. 613). London: FT Prentice Hall.
Zurück zum Zitat Villalonga, B. (2000). Diversification discount or premium? New evidence from BITS establishment-level data. Journal of Finance, 59, 475–503. Villalonga, B. (2000). Diversification discount or premium? New evidence from BITS establishment-level data. Journal of Finance, 59, 475–503.
Zurück zum Zitat Weston, F., Siu, A., & Johnson, B. A. (2002). Takeovers, restructuring and corporate governance (pp. 171–184). London: Prentice Hall. Weston, F., Siu, A., & Johnson, B. A. (2002). Takeovers, restructuring and corporate governance (pp. 171–184). London: Prentice Hall.
Zurück zum Zitat Wong, A., Cheung, K. Y., & Mun, T. (2009). The effects of merger and acquisition announcements on the security prices of bidding firms and target firms in Asia. International Journal of Economics and Finance, 1(2), 274–228. CrossRef Wong, A., Cheung, K. Y., & Mun, T. (2009). The effects of merger and acquisition announcements on the security prices of bidding firms and target firms in Asia. International Journal of Economics and Finance, 1(2), 274–228. CrossRef
Metadaten
Titel
Corporate Diversification-Performance Puzzle in BRIC
verfasst von
Svetlana Grigorieva
Copyright-Jahr
2020
DOI
https://doi.org/10.1007/978-3-030-23850-6_9