The Impact of Family Ownership on the Divestment Decision

Alain Praet ()
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Alain Praet: Hogeschool-Universiteit Brussel (HUB), Belgium

No 2009/19, Working Papers from Hogeschool-Universiteit Brussel, Faculteit Economie en Management

Abstract: Using 1972 firm-year observations of Belgian subsidiaries, I examine whether the previously documented better performance of family firms can be attributed to the more efficient divestiture decision in these firms. Consistent with this hypothesis, the results reveal that families holding large blocks of shares engage in more restructuring activity. Also, when the founder is present in the family firm, when the chairman of the board belongs to the family or when the function of CEO and chairman is not occupied by the same person, the likelihood of a voluntary restructuring will be higher.

Keywords: Family Firms; Divestiture; Subsidiaries (search for similar items in EconPapers)
JEL-codes: G32 G34 (search for similar items in EconPapers)
Pages: 35 page
Date: 2009-09
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Persistent link: https://EconPapers.repec.org/RePEc:hub:wpecon:200919

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