Firm Restructuring during Performance Declines

• Main Authors: Yi-Chun Lin, 林怡君
• Other Authors: Ming-Yuan Chen
• Format: Others
• Language: zh-TW
• Published: 2002
• Online Access: http://ndltd.ncl.edu.tw/handle/36437491448382415002

碩士 === 淡江大學 === 產業經濟學系 === 90 === This paper documents the restructuring of 220 Taiwanese firms that experienced a large decline in performance. I identify all firms listed on the Taiwan Stock Exchange during 1995 to 2000 that have a ratio of pretax operating income to assets that exceeds that industry median. Then I require that the ratio of operating income to interest expense be greater then one. For these ‘healthy’ firms in a base year, I examine the subset of firms that experienced a decline of at least 50% in their pretax operating income in the subsequent year. This procedure results in a sample of 220 firms. These firms implement a number of asset contraction actions and employment changes; also perform asset expansion actions and internal reorganization actions. Firms also change the internal control and external control. Hypotheses are tested Probit analysis using the data of 220 Taiwan’s listed firms during the period 1995-2000. Empirical results show that the size, leverage, decline extent of their pretax operating income, the evaluation of stock market, business group affect