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Title: Blockholders presence, identity and institutional context. Are they relevant for firm value?
Author: Sacramento, Mário
Moreira, António Carrizo
Vieira, Elisabete F. Simões
Keywords: blockholders
firm value
family firms
institutional investors
institutional context
Issue Date: 2013
Publisher: Inderscience
Abstract: This study analyses the relationship between ownership concentration and firm value. Our findings, based on a dynamic panel data analysis, show that there is a quadratic relationship between the company’s value and its ownership concentration. Additionally, our evidence suggests that for countries where investor protection is low, the relationship follows an inverted ‘U’ shape, while for countries where investor protection is high, the relationship is positive and nearly linear. Moreover, the influence of blockholders depends on their identity. This paper highlights the superior performance of family firms in controlling agency problems, a situation which contrasts vis-à-vis institutional shareholders. Finally, we report that the family effect is nonlinear. Indeed the positive effect starts to taper off at around 30% of ownership being somewhat smaller and less statistically significant between 30% and 50% of ownership. Moreover, in contrast to recent studies, the family effect is more pronounced in majority-controlled firms.
Peer review: yes
DOI: 10.1504/IJBGE.2013.052740
ISSN: 1477-9048
Appears in Collections:GOVCOPP - Artigos

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