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Influential ownership and capital structure

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Author Info

  • Salla Pöyry

    (Department of Finance and Statistics, HANKEN School of Economics, Helsinki, Finland)

  • Benjamin Maury

    (Department of Finance and Statistics, HANKEN School of Economics, Helsinki, Finland)

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    Abstract

    This paper explores the relation between ownership structures and capital structures in Russia-an economy with a state-run banking sector, weak corporate governance, and highly concentrated ownership. We find that firms with the state as controlling shareholder have significantly higher leverage than firms controlled by domestic private controlling shareholders other than oligarchs. Both firms controlled by the state or oligarchs finance their growth with more debt than other firms. Profitability is negatively related to leverage across all types of controlling owners, indicating a preference for internal funding over debt. The results indicate that firms with owners that have political influence or ties to large financial groups enjoy better access to debt. Copyright © 2009 John Wiley & Sons, Ltd.

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    File URL: http://hdl.handle.net/10.1002/mde.1477
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    Bibliographic Info

    Article provided by John Wiley & Sons, Ltd. in its journal Managerial and Decision Economics.

    Volume (Year): 31 (2010)
    Issue (Month): 5 ()
    Pages: 311-324

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    Handle: RePEc:wly:mgtdec:v:31:y:2010:i:5:p:311-324

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    Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/7976

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    References

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    Cited by:
    1. Berezinets, Irina & Ilina, Yulia & Muravyev, Alexander, 2011. "CEO and Board Characteristics as Determinants of Private Benefits of Control: Evidence from the Russian Stock Exchange," IZA Discussion Papers 6256, Institute for the Study of Labor (IZA).

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