Ownership and Operating Performance of Spanish Family IPO Firms

2020 ◽  
pp. 210-233
Author(s):  
Fuencisla Martínez Lobato ◽  
C. José García Martín ◽  
José Emilio Farinós Viñas
Keyword(s):  
Empirical Evidence ◽  
Initial Public Offering ◽  
Ownership Structure ◽  
Family Firms ◽  
Operating Performance ◽  
Operational Performance ◽  
The Family ◽  
Spanish Family ◽  
Public Offering ◽  
A Company

Previous studies have shown the existence of a relationship between the ownership structure of a company and its operational performance. In this context, the empirical evidence reveals that after an initial public offering (IPO), companies experience a decline in their operational performance. In this research, the authors investigate whether the characteristics of Spanish family firms led to a different operating behavior with respect to non-family companies when they go public through an IPO. The results show that the particularities of the family firm do not turn into significant differences in operational performance after the listing process.

scholarly journals The Role of Political Connections and Family Ownership in Increasing Firm Value

2021 ◽  
Vol 10 (1) ◽  
pp. 40-53
Author(s):  
Momon ◽  
Lela Nurlaela Wati ◽  
Sutar
Keyword(s):  
Empirical Evidence ◽  
Ownership Structure ◽  
Firm Value ◽  
Business Environment ◽  
Political Connections ◽  
Family Ownership ◽  
Governance Mechanism ◽  
Manufacturing Companies ◽  
The Family ◽  
A Company

In the face of business competition, a company strategy is needed by seeking and exploiting opportunities in the business environment, one of which is through political connections. Ownership structure plays an essential role in the company to determine the firm performance. The high concentration of family ownership has the power to reduce agency conflicts between management and stakeholders in a company. Concentrated ownership can serve as corporate governance mechanism for better and effective monitoring of management. This study was conducted to determine empirical evidence of the effect of political connections and family ownership structure on firm value. The sample in this study was 390 data of the manufacturing company. The data analysis used is moderating regression analysis. The results of this study are a positive influence of political connections and family ownership structure on firm value. The results showed that the more the company had a strong political connection and was controlled by the family, the more the firm value would increase. The interaction of political connections can strengthen the influence of family ownership on firm value. It proves that the family ownership structure plays a role in determining political connections in Indonesia, especially in manufacturing companies. The existence of empirical evidence that shows that the firm value controlled by a politically connected family is higher than companies that are not connected politically, which implies investors to invest in companies that are politically connected and companies controlled by families with majority ownership because it is proven to increase firm value.

Corporate Governance in European IPOs

2018 ◽  
pp. 505-533
Author(s):  
Fabio Bertoni ◽  
Michelle Meoli ◽  
Silvio Vismara
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Empirical Evidence ◽  
Initial Public Offering ◽  
Board Independence ◽  
The Public ◽  
The Board Of Directors ◽  
Significant Step ◽  
Public Offering ◽  
A Company

Establishing effective corporate governance is most important at the time of an initial public offering (IPO), because the IPO represents a significant step by a company toward moving to the public arena. This chapter focuses on three characteristics that help describe structure of the board of directors at the time of IPO: board size (i.e., the number of members on a board), board independence (i.e., the proportion of non-executive members on the board), and board leadership (i.e., the choice to overlap the roles of CEO and chairman of the board). The chapter presents empirical evidence from a sample of 969 companies that went public between 1995 and 2011 in France, Germany, and Italy that shows how these companies differ from their US and UK counterparts.

Family dynamics and gender perspective influencing copreneurship practices

2018 ◽  
Vol 26 (1) ◽  
pp. 14-33 ◽  
Author(s):  
Mário Franco ◽  
Patricia Piceti
Keyword(s):  
Gender Roles ◽  
Empirical Evidence ◽  
Family Dynamics ◽  
Family Firms ◽  
Business Management ◽  
Business Success ◽  
Business Practices ◽  
Content Type ◽  
The Family ◽  
And Gender

Purpose The purpose of this paper is to understand the family dynamics factors and gender roles influencing the functioning of copreneurial business practices, to propose a conceptual framework based on these factors/roles. Design/methodology/approach For this purpose, a qualitative approach was adopted, through the analysis of seven businesses created by copreneurial couples in an emerging economy – Brazil. Data were obtained from an open interview with each member of the selected couples who are in charge of firm management. Findings The empirical evidence obtained shows that the most important factors for successful copreneurial family businesses are professionalization, dividing the couple’s tasks and business management. Trust, communication, flexibility and common goals are other essential relational-based factors for the good functioning of this type of family business and stability in the personal relationship. Practical implications It is clear that professionalization and the separation of positions and functions are fundamental for a balance between business management and the couple’s marital life. When couples are in harmony and considering factors such as trust, communication and flexibility (relational-based factors), the firm’s life-cycle and business success become real and more effective. Originality/value From the family dynamics factors and gender roles, this study focused on one of the most important and integrated family firm relationships, copreneurial couples. As there is little research on the heterogeneity of family firms runs specifically by copreneurial couples, this study is particularly important and innovative in the context of a developing economy, such as Brazil. Based on empirical evidence, this study was proposed an integrative and holistic framework that shows the functioning of copreneurial businesses practices.

scholarly journals Do family firms perform better: A Belgian survey

2007 ◽  
Vol 4 (4) ◽  
pp. 173-182
Author(s):  
Christiane Bughin ◽  
Olivier Colot ◽  
Karin Comblé
Keyword(s):  
Agency Theory ◽  
Empirical Evidence ◽  
Ownership Structure ◽  
Family Firms ◽  
Management Practices ◽  
Family Values ◽  
Economic Literature ◽  
Paired Samples ◽  
Better Than

A large conceptual economic literature presents assumptions that family owned and controlled firms perform better than others, essentially on the basis of agency theory, ownership structure, cultural specificities and particular management practices. Large empirical evidence has been supplied by various studies, even if there are still contradictory debates. This paper uses the paired samples methodology to compare operational, economic and financial profitabilities of Belgian family firms. Evidence is given that they perform better, and this significantly for economic profitability. Discussion is engaged about the contribution of family values and practices to their results.

scholarly journals How Syndicate Short Sales Affect the Informational Efficiency of IPO Prices and Underpricing

2010 ◽  
Vol 45 (2) ◽  
pp. 441-471 ◽  
Author(s):  
Björn Bartling ◽  
Andreas Park
Keyword(s):  
Theoretical Model ◽  
Initial Public Offering ◽  
Informational Efficiency ◽  
Short Sales ◽  
Market Prices ◽  
Standard Practice ◽  
Public Offering ◽  
A Company

AbstractWhen a company goes public, it is standard practice that the underwriting syndicate allocates more shares than are issued. The underwriter thus holds a short position that it commonly fills by aftermarket trading when market prices fall or, when prices rise, by executing the so-called overallotment option. This option is a standard feature of initial public offering (IPO) arrangements that allows the underwriter to purchase more shares from the issuer at the original offer price. We propose a theoretical model to study the implications of this combination of short position and overallotment option on the pricing of the IPO. Maximizing the sum of both the profits from their share of the offer revenue and the potential profits from aftermarket trading, we show that underwriters strategically distort the offer price. This results either in exacerbated underpricing when favorably informed underwriters lower prices to secure a signaling benefit, or in informationally inefficient offer prices when underwriters pool in offer prices irrespective of their information.

TRX, Inc.: Initial Public Offering

2017 ◽  
pp. 1-21
Author(s):  
Susan Chaplinsky ◽  
Kensei Morita ◽  
Xing Zeng
Keyword(s):  
Initial Public Offering ◽  
Ownership Structure ◽  
Best Interest ◽  
Going Public ◽  
Sequence Of Events ◽  
Business Opportunities ◽  
Public Offering ◽  
Strategic Reorganization ◽  
Dot Com ◽  
Comprehensive Coverage

This case provides comprehensive coverage of a firm's decision to undertake an IPO and the process of going public. The case follows the sequence of events from the company's incorporation in 1999 through the completion of an IPO in September 2005. In addition to raising capital, the TRX IPO case also includes consideration of another motivation for going public. At the time of its incorporation in November 1999, TRX attempted to go public but in the ensuing dot-com collapse, the IPO was never completed. In response to the failed IPO, TRX president and CEO, Trip Davis, turned to strategic investors to raise $20 million in a note convertible into equity at $11 per share. Although Davis had hoped the strategic investors would provide guidance and business opportunities for TRX, they never materialized. By 2004, he had come to believe that the largest strategic investor, Sabre, Inc., was not working in TRX's best interest. Thus, the IPO is motivated by a twofold purpose: to raise money and to provide for a strategic reorganization of the firm's ownership structure.

scholarly journals Do families shape corporate governance structures?

2009 ◽  
Vol 15 (3) ◽  
pp. 327-345 ◽  
Author(s):  
María Sacristán Navarro ◽  
Silvia Gómez Ansón
Keyword(s):  
Corporate Governance ◽  
Empirical Evidence ◽  
Family Firms ◽  
Family Firm ◽  
Family Ownership ◽  
Governance Structures ◽  
Listed Firms ◽  
Board Committees ◽  
Spanish Family ◽  
Open Question

AbstractThis paper provides empirical evidence of family firm corporate governance structures, by examining a set of corporate governance characteristics of 132 non-financial Spanish listed firms. Results show that family firm boards present differential characteristics and that different patterns of family ownership configurations do not affect family firm corporate governance structures. We find that Spanish family firm boards are smaller than those in non-family firms. Family firm directors own a larger fraction of firm shares and have longer Chairman tenure than non-family firms, and family firms use fewer voluntary board committees – such as nomination and remuneration committees and executive committees. Besides, family firm boards and committees are biased towards insiders. Whether these differential characteristics affect other minority non-family shareholders negatively remains an open question.

Is family ownership of a firm associated with the control of managerial discretion and corporate decisions?

2016 ◽  
Vol 6 (1) ◽  
Author(s):  
Jennifer Martinez Ferrero ◽  
Lázaro Rodríguez-Ariza ◽  
Manuel Bermejo-Sánchez
Keyword(s):  
Ownership Structure ◽  
Design Methodology ◽  
Family Firms ◽  
Managerial Discretion ◽  
Family Ownership ◽  
Managerial Decisions ◽  
Corporate Decisions ◽  
Type Design ◽  
The Family ◽  
The Impact

Purpose This paper considers the association between family firms and managerial discretion, hypothesising that a higher degree of family ownership may decrease the conflict of interest between owners and managers, thus avoiding the risk of discretionary actions by the latter. Design/methodology/approach Our empirical analysis is based on a large sample of international listed companies from 20 countries including the Special Administrative Region of Hong Kong and covers the period 2002–2010. Methodologically, we use a logit model with marginal effects on the panel data. Findings Our analysis shows that family ownership is associated with greater control and monitoring of managerial decisions, thus avoiding information asymmetries and, therefore, the risk of discretionary actions. In other words, family owners impose a stronger discipline and dissuade non-family managers from using managerial discretion to act in their own interest. Finally, we clarify the inconclusive results reported previously about the effects of family ownership on discretionary practices. Originality/value Our paper contributes to the family firm literature by providing evidence of the impact of ownership structure on the level of discretionay practices. Furthermore, we explore the differences between family and non-family firms as each group has its own varied characteristics. Moreover, in contrast to most previous studies, which have focused on only one country, we extend the analysis to include an international sample of 20 countries. This leads to potentially more powerful and generalizable results.

scholarly journals Family firms control structure and corporate sustainability

2015 ◽  
Vol 13 (1) ◽  
pp. 1088-1100
Author(s):  
Hsiang-Tsai Chiang ◽  
Fang-Chun Liu
Keyword(s):  
Family Firms ◽  
Control Structure ◽  
Corporate Sustainability ◽  
Internal Degree ◽  
Single Family ◽  
Positive Relation ◽  
The Public ◽  
The Family ◽  
The Board Of Directors ◽  
A Company

A company with CSR devotion reflects this company aims not only in making profit, but also in sustainability. Family-owned companies have possessed of both control and operation right of the company, and family will devote themselves in CSR to signal the company’s commitment and then gains good image in order to sustainable and to maximize family benefit, The result indicated a positive relation between sustainability and the percentage of control shareholding, and negative relations between sustainability and two kinds of characteristic of family firms, which are the internal degree of the Board of Directors and the firm directed by single family. The evidence can offer stakeholders or the public to judge or predict the future development of the family firm.

scholarly journals CAN ACCOUNTING INFORMATION ACT AS A PROXY FOR EX ANTE UNCERTAINTY IN INITIAL PUBLIC OFFERINGS?

2003 ◽  
Vol 5 (2) ◽  
pp. 249 ◽  
Author(s):  
Tatang Ary Gumanti
Keyword(s):  
Empirical Evidence ◽  
Initial Public Offerings ◽  
Initial Public Offering ◽  
Accounting Information ◽  
Firm Risk ◽  
Public Offerings ◽  
Accounting Numbers ◽  
Ex Ante ◽  
Value Of Firm ◽  
Public Offering

This paper reviews and summarizes previous works and the rationale for the proposition that accounting information is in fact value relevant in the determination of an initial public offering IPO).Theoretical and empirical evidence has indicated that certain accounting measures can he used as proxies for total firm risk, that is, they could determine the riskiness of a corporation. The literature also advocates that accounting information is relevant in determining the value and thus the riskiness of a corporation through the use of accounting analysis. Since most of the information available in the prospectus is accounting information, it is arguable that this information represents a potential source for assessing the issuing firm. Some scholars have also advocated the possibility of using accounting information in assessing the value of firm making an IPO. Numerous papers have provided analytical and empirical evidence of the association between accounting numbers and the value of IPOs. The conclusion generally comes to show that information in the prospectus is value relevant concerning the IPO. The paper shows that it is indeed an arguable to use accounting information in the valuation of an IPO. Accordingly, it is an empirical issue whether accounting information has the property in explaining the ex-ante uncertainty of an IPO.

Sign in / Sign up

Export Citation Format

Share Document