Abstract

http://ssrn.com/abstract=1884171
 
 

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The Effects of Ownership and Stock Liquidity on the Timing of Repurchase Transactions


Amedeo De Cesari


Aston University - Aston Business School - Finance & Accounting Group

Susanne Espenlaub


University of Manchester - Manchester Business School

Arif Khurshed


University of Manchester - Manchester Business School, Division of Accounting Finance

Michael Simkovic


University of North Carolina at Chapel Hill School of Law; Seton Hall Law School; Harvard Law School - John M. Olin Center for Law and Economics

June 6, 2012


Abstract:     
We analyze detailed monthly data on U.S. open market stock repurchases (OMRs) that recently became available following stricter disclosure requirements. We find evidence that OMRs are timed to benefit non-selling shareholders. We present evidence that the profits to companies from timing repurchases are significantly related to ownership structure. Institutional ownership reduces companiesā€™ opportunities to repurchase stock at bargain prices. At low levels, insider ownership increases timing profits and at high levels it reduces them. Stock liquidity increases profits from timing OMRs.

Number of Pages in PDF File: 59

Keywords: open market repurchase, timing, ownership, liquidity

JEL Classification: G35, G38

working papers series


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Date posted: July 12, 2011 ; Last revised: August 26, 2012

Suggested Citation

De Cesari, Amedeo and Espenlaub, Susanne and Khurshed, Arif and Simkovic, Michael, The Effects of Ownership and Stock Liquidity on the Timing of Repurchase Transactions (June 6, 2012). Available at SSRN: http://ssrn.com/abstract=1884171 or http://dx.doi.org/10.2139/ssrn.1884171

Contact Information

Amedeo De Cesari (Contact Author)
Aston University - Aston Business School - Finance & Accounting Group ( email )
Aston Triangle
Birmingham, B4 7ET
United Kingdom
+44 (0) 121 2043028 (Phone)
Susanne Espenlaub
University of Manchester - Manchester Business School ( email )
Booth Street West
Manchester, M15 6PB
United Kingdom
Arif Khurshed
University of Manchester - Manchester Business School, Division of Accounting Finance ( email )
Crawford House
Oxford Road
Manchester, M15 6PB
United Kingdom
+44 0 161 275 4475 (Phone)
+44 0 161 275 4023 (Fax)
Michael Simkovic
University of North Carolina at Chapel Hill School of Law ( email )
Van Hecke-Wettach Hall, 160 Ridge Road
CB #3380
Chapel Hill, NC 27599-3380
United States
919-537-3701 (Phone)

Seton Hall Law School ( email )
One Newark Center
Newark, NJ 07102-5210
United States
Harvard Law School - John M. Olin Center for Law and Economics ( email )
Cambridge, MA 02138
United States
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