This paper investigates why firms choose to divest their units/segments, and how firms choose among the three divestiture mechanisms (equity carveout, spinoff, and asset selloff). A direct comparison is conducted on firm’s viable choices on a comprehensive sample of corporate divestiture...

We argue that the empirical evidence against the capital asset pricing model (CAPM) based on stock returns does not invalidate its use for estimating the cost of capital for projects in making capital budgeting decisions. Because stocks are backed not only by projects in place, but also by the...

"We investigate the effect of ownership structure on initial public offering (IPO) valuation in the Taiwanese market, in which many large shareholders exert control through pyramidal structures and cross-shareholdings with voting rights that are in excess of cash flow rights. Our analysis...

type="main" <p>The authors' study of audit committees in 450 large East Asian companies (150 each in Hong Kong, Singapore, and Malaysia) finds a strong positive correlation between the “cash flow” ownership (as opposed to just the voting rights) of large shareholders and the percentage of...</p>

This study provides new evidence that IPO underpricing is economic rents paid for investor to gather costly information. Subrahmanyam and Titman (1999) report that diverse investor information, once aggregated in the public market, could provide a more informative stock price and accurate...

This study empirically examines the impact of various competitive cost proxies on the extent of product-related information disclosed by biotech initial public offerings (IPOs) in their prospectuses. The choice of biotech companies, which operate in a fiercely competitive environment,...

Investigates how investment bankers use indications of interest from client investors to price and allocate new issues. Investors who buy initial public offerings (IPOs) can achieve sizable early returns. Recent research rationalizes this apparent contradiction to market efficiency as a response...