Corporate Governance and Divestitures

• Main Authors: Chih-Hao Chang, 張志豪
• Other Authors: none
• Format: Others
• Language: zh-TW
• Published: 2003
• Online Access: http://ndltd.ncl.edu.tw/handle/37309544487617410426

碩士 === 逢甲大學 === 會計與財稅所 === 91 === Due to the global economic recession in the late 1990’s, many companies in Taiwan have been adjusting their operational strategies through divestitures for the recent years. However, whether such restructurings could produce economic benefits are the main concerns of the investors in the stock market. Since the mechanisms of corporate governance are regards as efficient tools in protecting shareholders welfare. Accordingly, the first purpose of this research is to investigate the economic effects of divestiture activities by Taiwanese companies. Second, to identify the value-enhancing factors of corporate governance associated with divestiture decisions by Taiwanese firms. This research adopts the market model of the event study to evaluate the wealth effects of divestitures by firms. And, we also apply the cross-sectional analysis to identify the determinants of these effects of divestiture activities. The empirical results show that the divestitures by Taiwanese firms elicit significant positive effects on their shareholders’ wealth. And, the ownership of the institutional investors and the insiders of firms, and the gains or losses of divestiture transactions are related to the magnitude of these wealth effects.