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Corporate Restructuring in Japan; An Event-Study Analysis

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  • Jorge A Chan-Lau

Abstract

The implementation of the Commercial Rehabilitation Law (CRL) on April 1, 2000 was considered a key event in setting up the official infrastructure supporting corporate restructuring in Japan. This study evaluates the stock price impact of restructuring announcements before and after the CRL implementation using event-study analysis. Following the CRL implementation, the results suggest an improvement in market credibility of restructuring announcements based on improvements in disclosure, mergers, and to a lesser extent, labor force reductions. In contrast, credibility of restructuring announcements aimed at reducing excess capital deteriorated.

Suggested Citation

  • Jorge A Chan-Lau, 2001. "Corporate Restructuring in Japan; An Event-Study Analysis," IMF Working Papers 01/202, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:01/202
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    Cited by:

    1. Nangia, Vinay Kumar & Agrawal, Rajat & Reddy, K. Srinivasa, 2011. "Open Offers and Shareholders Earnings – Evidence from India," MPRA Paper 60432, University Library of Munich, Germany, revised 2011.
    2. Jérôme Hubler & Pierre-Xavier Meschi & Géraldine Schmidt, 2004. "Annonces de suppressions d’emplois et valeur boursière de l’entreprise," Revue Finance Contrôle Stratégie, revues.org, vol. 7(4), pages 107-142, December.

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    Keywords

    Corporate governance; Japan; corporate restructuring; event-study analysis; stock price; shareholders; stock prices;

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