Value of Corporate Control: Some International Evidence

34 Pages Posted: 12 Oct 2001

See all articles by Paul Hanouna

Paul Hanouna

Villanova University - School of Business

Atulya Sarin

Santa Clara University - Department of Finance

Alan C. Shapiro

University of Southern California - Marshall School of Business

Multiple version iconThere are 2 versions of this paper

Date Written: 2001

Abstract

Existing literature shows that the market values control because controlling shareholder can generate private benefits and improve the efficiency of the corporation. In this study, we provide a measure of the value of control for a set of domestic and foreign transactions. Our measure of the value of control is the difference between the offer premium for minority and comparable majority transactions. We find that the median control premiums in the United States are around 30%. The control premium in 'market-oriented' countries are higher than that for the "bank-oriented" countries. Also, we find that the premiums are lower in "cross-border" transactions relative to "domestic transactions."

JEL Classification: G30, G34

Suggested Citation

Hanouna, Paul E. and Sarin, Atulya and Shapiro, Alan C., Value of Corporate Control: Some International Evidence (2001). USC Finance & Business Econ. Working Paper No. 01-4. Available at SSRN: https://ssrn.com/abstract=286787 or http://dx.doi.org/10.2139/ssrn.286787

Paul E. Hanouna

Villanova University - School of Business ( email )

800 Lancaster Avenue
Villanova, PA 19085-1678
United States

Atulya Sarin

Santa Clara University - Department of Finance ( email )

Leavey School of Business and Administration
Santa Clara, CA 95053
United States
408-554-4953 (Phone)
408-904-4498 (Fax)

HOME PAGE: http://business.scu.edu/asarin

Alan C. Shapiro (Contact Author)

University of Southern California - Marshall School of Business ( email )

Department of Finance
Los Angeles, CA 90089
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
2,289
rank
5,315
Abstract Views
6,721
PlumX Metrics