Author : Philip G. Berger
Release : 1998
Genre :
Kind : eBook
Book Rating : /5 ( reviews)
Book Synopsis Causes and Effects of Corporate Refocusing by : Philip G. Berger
Download or read book Causes and Effects of Corporate Refocusing written by Philip G. Berger. This book was released on 1998. Available in PDF, EPUB and Kindle. Book excerpt: We study the precursors and outcomes of refocusing episodes by 107 diversified firms that were not taken over between 1984 and 1993. These firms had more value-reducing diversification policies than diversified firms that did not refocus. However, major disciplinary or incentive-altering events (including management turnover, outside shareholder pressure, changes in management compensation, and financial distress) usually occurred before refocusing took place. The cumulative abnormal returns over a firm's refocusing-related announcements averaged 7.3%, and were significantly related to the amount of value-reduction associated with the refocuser's diversification policy.
