Corporate restructuring and product market behaviour
This article investigates the relationship between product market behaviour and corporate restructuring policies. We focus on two types of corporate restructuring events: acquisitions and divestitures. We find that 1 year after acquisition, acquiring firms on average experience long-term deteriorating product market performance. In addition, acquiring firms in industries with less competition have worse performance in subsequent years. In comparison, divesting firms experience no significant change in the performance after divestitures. Last, we document that a sustainable product market improvement is related to higher stock market valuation while a temporary improvement have negative effects. Therefore, we show that corporate restructuring has an important firm-value implication through the channel of product market effects.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 23 (2013)
Issue (Month): 7 (April)
|Contact details of provider:|| Web page: http://www.tandfonline.com/RAFE20|
|Order Information:||Web: http://www.tandfonline.com/pricing/journal/RAFE20|
When requesting a correction, please mention this item's handle: RePEc:taf:apfiec:v:23:y:2013:i:7:p:603-617. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty)
If references are entirely missing, you can add them using this form.