OWNERSHIP AND CAPITAL STRUCTURE OF CHILEAN CONGLOMERATES:FACTS AND HYPOTHESES FOR GOVERNANCE

Fernando Lefort () and Eduardo Walker ()
Additional contact information
Fernando Lefort: Escuela de Administración, Pontificia Universidad Católica de Chile

Abante, 2000, vol. 3, issue 1, pages 3-27

Abstract: In this paper we provide an accurate descriptive analysis of consolidated ownership and capital structures in Chilean conglomerates, emphasizing the implications of these structures for corporate governance. We avoid double counting investments made through pyramid schemes, and consider the universe of non-financial firms registered at the Superintendencia de Seguros y Valores (SVS). We find that economic groups are the predominant form of corporate structure in Chile, and that the most common way of separating control from cash-flow rights in Chilean conglomerates is through pyramid schemes. These schemes have proven to be successful in raising external funding. Controllers of Chilean conglomerates rely in a relatively small number of people in order to conduct business, and these people participate exclusively as board members of corporations affiliated to their group. However, controllers of Chilean conglomerates hold more equity than strictly needed for control, suggesting that cash-flow benefits associated to subsidiaries are relatively large. Finally, pension funds and ADRs constitute a significant minority shareholder in Chilean groups.

Keywords: Corporate Governance; Conglomerates; Capital Structure; Chile; Emerging Economies (search for similar items in EconPapers)
JEL-codes: G32 (search for similar items in EconPapers)
Date: 2000
View list of references View citations in EconPapers

Downloads: (external link)
http://www.abante.cl/files/ABT/Contenidos/Vol-3-N1/1%20Lefort%20Walker.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:pch:abante:v:3:y:2000:i:1:p:3-27

Ordering information: This journal article can be ordered from

Access Statistics for this article

Abante is edited by Eduardo Walker

More articles in Abante from Escuela de Administracion. Pontificia Universidad Católica de Chile.
Contact information at EDIRC.
Series data maintained by Verónica Gil ().