Among firms listed in Western Europe and East Asia, when creditor protection is strong, the controlling shareholder trades off retaining control in bad states through pyramiding against retaining the upside in good states via leverage. This result might arise because the controlling shareholder...

This paper provides a comprehensive examination of the ways in which companies respond to a country-wide crisis through the restructuring of their assets (through asset sales, mergers or liquidations) or liabilities. We find the restructuring of liabilities to be the most common type of...

We examine announcement period abnormal returns to acquirers of listed and unlisted targets in 17 Western European countries over the interval 1996–2001. Acquirers of listed targets earn an insignificant average abnormal return of –0.38%, while acquirers of unlisted targets earn a...

We study the evolution of the control structure of 141 privatized firms from OECD countries over the period from 1996 through 2000. We find that governments do not relinquish control after “privatization.” We show that the market-to-book ratios of privatized firms converge through time to...

Examination of firms in 47 countries shows a widespread overlap of controlling shareholders and top officers who are connected with national parliaments or governments, particularly in countries with higher levels of corruption, with barriers to foreign investment, and with more transparent...

Whereas most U.S. corporations are widely held, the predominant form of ownership in East Asia is control by a family, which often supplies a top manager. These features of "crony capitalism" are actually more pronounced in Western Europe. In both regions, the salient agency problem is...

We study merger and acquisition (M&A) payment choices of European bidders for publicly and privately held targets in the 1997-2000 period. Europe is an ideal venue for studying the importance of corporate governance in making M&A payment choices, given the large number of closely held firms and...

Using new data for the universe of firms covered in Amadeus, we reconstruct the portfolios of shareholders who hold equity stakes in private and publicly-traded European firms. We find great heterogeneity in the degree of portfolio diversification across large shareholders. Exploiting this...