Valuation and performance of firms in complex ownership structures : an application to Korean chaebols

Detalhes bibliográficos
Autor(a) principal: Almeida, Heitor
Data de Publicação: 2007
Tipo de documento: Artigo
Idioma: eng
Título da fonte: Repositório Institucional do FGV (FGV Repositório Digital)
Texto Completo: http://hdl.handle.net/10438/12466
Resumo: We propose several new metrics to describe the complex ownership structure of business groups, and provide simple formulas and algorithms to compute these metrics. We use these measures to describe in detail the ownership structure of Korean chaebols in the period of 2003 to 2004. In addition, we validate the usefulness of our new metrics by showing empirically that they are important for understanding the valuation and performance of group firms. In particular, we show evidence that firms that are central to the control structure of the chaebol (central firms), firms in cross-shareholdings, and firms that are placed at the bottom of the group (i.e., with lower ultimate ownership) have lower profitability than other group firms. The valuation results suggest that central firms and firms in cross-shareholding loops have lower valuations than other public Chaebol firms. The lower valuation of these firms is not explained by variation in measures of ownership concentration and separation between ownership and control.
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spelling Almeida, HeitorEscolas::EPGEFGV2014-11-18T11:24:38Z2014-11-18T11:24:38Z2007-05-30http://hdl.handle.net/10438/12466We propose several new metrics to describe the complex ownership structure of business groups, and provide simple formulas and algorithms to compute these metrics. We use these measures to describe in detail the ownership structure of Korean chaebols in the period of 2003 to 2004. In addition, we validate the usefulness of our new metrics by showing empirically that they are important for understanding the valuation and performance of group firms. In particular, we show evidence that firms that are central to the control structure of the chaebol (central firms), firms in cross-shareholdings, and firms that are placed at the bottom of the group (i.e., with lower ultimate ownership) have lower profitability than other group firms. The valuation results suggest that central firms and firms in cross-shareholding loops have lower valuations than other public Chaebol firms. The lower valuation of these firms is not explained by variation in measures of ownership concentration and separation between ownership and control.engEscola de Pós-Graduação em Economia da FGVSeminários de pesquisa econômica da EPGETodo cuidado foi dispensado para respeitar os direitos autorais deste trabalho. Entretanto, caso esta obra aqui depositada seja protegida por direitos autorais externos a esta instituição, contamos com a compreensão do autor e solicitamos que o mesmo faça contato através do Fale Conosco para que possamos tomar as providências cabíveisinfo:eu-repo/semantics/openAccessBusiness groupsFamily firmsFirm performancePyramidsCross-shareholdingsParent company discountEconomiaAdministração de empresasEmpresas familiaresEconomiaValuation and performance of firms in complex ownership structures : an application to Korean chaebolsinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articlereponame:Repositório Institucional do FGV (FGV Repositório Digital)instname:Fundação Getulio Vargas (FGV)instacron:FGVORIGINAL2203.pdf2203.pdfapplication/pdf562835https://repositorio.fgv.br/bitstreams/1a55fa6e-d9a8-4e23-b391-a34863dd2025/downloadbc24ace08d50d80798e27ec8f4c2f6f6MD51LICENSElicense.txtlicense.txttext/plain; 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dc.title.eng.fl_str_mv Valuation and performance of firms in complex ownership structures : an application to Korean chaebols
title Valuation and performance of firms in complex ownership structures : an application to Korean chaebols
spellingShingle Valuation and performance of firms in complex ownership structures : an application to Korean chaebols
Almeida, Heitor
Business groups
Family firms
Firm performance
Pyramids
Cross-shareholdings
Parent company discount
Economia
Administração de empresas
Empresas familiares
Economia
title_short Valuation and performance of firms in complex ownership structures : an application to Korean chaebols
title_full Valuation and performance of firms in complex ownership structures : an application to Korean chaebols
title_fullStr Valuation and performance of firms in complex ownership structures : an application to Korean chaebols
title_full_unstemmed Valuation and performance of firms in complex ownership structures : an application to Korean chaebols
title_sort Valuation and performance of firms in complex ownership structures : an application to Korean chaebols
author Almeida, Heitor
author_facet Almeida, Heitor
author_role author
dc.contributor.unidadefgv.por.fl_str_mv Escolas::EPGE
dc.contributor.affiliation.none.fl_str_mv FGV
dc.contributor.author.fl_str_mv Almeida, Heitor
dc.subject.por.fl_str_mv Business groups
Family firms
Firm performance
Pyramids
Cross-shareholdings
Parent company discount
topic Business groups
Family firms
Firm performance
Pyramids
Cross-shareholdings
Parent company discount
Economia
Administração de empresas
Empresas familiares
Economia
dc.subject.area.por.fl_str_mv Economia
dc.subject.bibliodata.por.fl_str_mv Administração de empresas
Empresas familiares
Economia
description We propose several new metrics to describe the complex ownership structure of business groups, and provide simple formulas and algorithms to compute these metrics. We use these measures to describe in detail the ownership structure of Korean chaebols in the period of 2003 to 2004. In addition, we validate the usefulness of our new metrics by showing empirically that they are important for understanding the valuation and performance of group firms. In particular, we show evidence that firms that are central to the control structure of the chaebol (central firms), firms in cross-shareholdings, and firms that are placed at the bottom of the group (i.e., with lower ultimate ownership) have lower profitability than other group firms. The valuation results suggest that central firms and firms in cross-shareholding loops have lower valuations than other public Chaebol firms. The lower valuation of these firms is not explained by variation in measures of ownership concentration and separation between ownership and control.
publishDate 2007
dc.date.issued.fl_str_mv 2007-05-30
dc.date.accessioned.fl_str_mv 2014-11-18T11:24:38Z
dc.date.available.fl_str_mv 2014-11-18T11:24:38Z
dc.type.status.fl_str_mv info:eu-repo/semantics/publishedVersion
dc.type.driver.fl_str_mv info:eu-repo/semantics/article
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dc.identifier.uri.fl_str_mv http://hdl.handle.net/10438/12466
url http://hdl.handle.net/10438/12466
dc.language.iso.fl_str_mv eng
language eng
dc.relation.ispartofseries.por.fl_str_mv Seminários de pesquisa econômica da EPGE
dc.rights.driver.fl_str_mv info:eu-repo/semantics/openAccess
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dc.publisher.none.fl_str_mv Escola de Pós-Graduação em Economia da FGV
publisher.none.fl_str_mv Escola de Pós-Graduação em Economia da FGV
dc.source.none.fl_str_mv reponame:Repositório Institucional do FGV (FGV Repositório Digital)
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