Market valuation effect of foreign asset divestitures in an emerging economy: : Korean evidence

• Autores: Hyunchul Lee, Kyung-In Park
• Localización: Emerging Markets Finance & Trade, ISSN-e 1558-0938, Vol. 52, Nº. 1, 2016, págs. 136-153
• Idioma: inglés
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• Resumen

  • We find evidence that foreign asset divestitures announced by Korean listed firms lead to a decrement in firm value. Interestingly the divestiture announcements by firms with a large proportion of institutional investors, who hold advanced professionalism in stock investments, contribute to an increment in firm value, but ones by firms with a large proportion of individual investors lead to a decrement in it. Unlike the case of firms in advanced countries, our distinctive finding that the divestiture announcements produce a decrement in firm value around the announcement day sheds new lights on market valuation effects of foreign asset divestitures of firms in other emerging economies