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Block trades and the benefits of control in Slovenia

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  • Aleksandra Gregoric
  • Cristina Vespro

Abstract

Ownership and control have been concentrating in most transition countries. The consolidation of control introduces changes in the power distribution within privatized firms and, most importantly, redirects the corporate governance problem to a conflict between large and small shareholders. In this study, we evaluate the ownership changes in Slovenian privatized firms through an analysis of stock price reactions to the entrance of a new blockholder (the shared benefits of control) and through an estimation of the premiums paid for large blocks (the private benefits of control). We provide evidence of and discuss the reasons for the failures of the privatization investment funds in implementing control over firm managers and in promoting the restructuring of firms in the first post-privatization years. Copyright (c) 2009 The Authors. Journal compilation (c) 2009 The European Bank for Reconstruction and Development.

Suggested Citation

  • Aleksandra Gregoric & Cristina Vespro, 2009. "Block trades and the benefits of control in Slovenia," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 17(1), pages 175-210, January.
  • Handle: RePEc:bla:etrans:v:17:y:2009:i:1:p:175-210
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    References listed on IDEAS

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    Cited by:

    1. Svetlana Grigorieva & Tatiana Petrunina, 2013. "The performance of mergers and acquisitions in emerging capital markets: new evidence," HSE Working papers WP BRP 20/FE/2013, National Research University Higher School of Economics.
    2. António Pedro Soares Pinto & Mário Gomes Augusto & Pedro M. Gama, 2010. "Bank Relationships And Corporate Governance: A Survey Of The Literature From The Perspective Of Smes," Portuguese Journal of Management Studies, ISEG, Universidade de Lisboa, vol. 0(1), pages 65-85.
    3. Danila Djokic, 2013. "Corporate Governance After 20 Years In Slovenia," Montenegrin Journal of Economics, Economic Laboratory for Transition Research (ELIT), vol. 9(2), pages 121-126.
    4. Aleksandra Gregoric & Arjana Brezigar Masten & Katarina Zajc, 2011. "From Social to Private Ownership: Multiple Blockholders in Slovenian Unlisted Firms," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 47(5), pages 27-51, September.
    5. Svetlana Grigorieva & Tatiana Petrunina, 2015. "The performance of mergers and acquisitions in emerging capital markets: new angle," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 26(4), pages 377-403, October.
    6. Trojanowski, Grzegorz, 2008. "Equity block transfers in transition economies: Evidence from Poland," Economic Systems, Elsevier, vol. 32(3), pages 217-238, September.
    7. Matjaž Črnigoj & Dušan Mramor, 2009. "Determinants of Capital Structure in Emerging European Economies: Evidence from Slovenian Firms," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 45(1), pages 72-89, January.
    8. Joze P. Damiajn & Aleksandra Grogoric & Janez Prasnikar, 2004. "Ownership Concentration and Firm Performance in Slovenia," LICOS Discussion Papers 14204, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
    9. Matjaž Ärnigoj & DuÅ¡an Mramor, 2009. "Determinants of Capital Structure in Emerging European Economies: Evidence from Slovenian Firms," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 45(1), pages 72-89, January.
    10. Aleksandra Gregoric & Arjana Brezigar Masten & Katarina Zajc, 2011. "From Social to Private Ownership: Multiple Blockholders in Slovenian Unlisted Firms," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 47(5), pages 27-51, September.

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