Performance Consequences of Privatizing Egyptian State-Owned Enterprises: The Effect of Post-Privatization Ownership Structure on Firm Performance

42 Pages Posted: 1 Jul 2015

See all articles by Mohammed Omran

Mohammed Omran

The Insurance Holding Company; Arab Academy for Science and Technology

Multiple version iconThere are 2 versions of this paper

Date Written: June 30, 2015

Abstract

This paper evaluates the financial and operating performance of newly privatized Egyptian state-owned enterprises and determines whether such performance differs across firms according to their new ownership structure. The Egyptian privatization program provides unique post-privatization data on different ownership structures. Since most studies do not distinguish between the types of ownership, this paper provides new insight into the impact that post-privatization ownership structure has on firm performance. The study covers 69 firms, which were privatized between 1994 and 1998. For these newly privatized firms, this study documents significant increases in profitability, operating efficiency, capital expenditures, and dividends. Conversely, significant decreases in employment, leverage, and risk are found, although output shows an insignificant decrease following privatization.

Keywords: privatization, SOEs, Egypt, and ownership structure

JEL Classification: G32, L33

Suggested Citation

Omran, Mohammed M., Performance Consequences of Privatizing Egyptian State-Owned Enterprises: The Effect of Post-Privatization Ownership Structure on Firm Performance (June 30, 2015). Multinational Finance Journal, Vol. 8, No. 1/2, p. 73-114, 2004, Available at SSRN: https://ssrn.com/abstract=2625143

Mohammed M. Omran (Contact Author)

The Insurance Holding Company ( email )

7 Talet Herb Street
Cairo
Egypt

Arab Academy for Science and Technology ( email )

P.O. Box. 1029
College of Management and Technology
Miami, Alexandria
Egypt
(203) 5482 532 (Phone)
(203) 5566 072 (Fax)

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