Do Malaysian Focus-Increasing Spin-Off Firms Underperform?

Nadisah Zakaria () and Glen Christopher Arnold
Additional contact information
Nadisah Zakaria: Salford Business School, The University of Salford, Manchester, M54WT United Kingdom
Glen Christopher Arnold: Salford Business School, The University of Salford, Manchester, M54WT United Kingdom

Asian Academy of Management Journal of Accounting and Finance (AAMJAF), 2012, vol. 8, issue 1, 91-123

Abstract: This paper investigates whether increased corporate focus surrounding a spin-off is associated with abnormal short-run and long-run share return performance from January 1980 to April 2011. By looking at the share return performance of both focus-increasing and non-focus-increasing parent firms, we find evidence against the claims of the focus-increasing hypothesis. Our results show that focus-increasing parent firms significantly underperformed when compared to their counterparts in the non-focus-increasing sub-sample during the few days surrounding the announcement date, even after adjusting for firm size. We also observe that spin-offs by the focus-increasing entities fail to demonstrate abnormal performance in the long-run period of three years.

Keywords: spin-offs; share returns performance; market efficiency; focus (search for similar items in EconPapers)
Date: 2012
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://web.usm.my/journal/aamjaf/vol8-1-2012/8-1-5.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: https://EconPapers.repec.org/RePEc:usm:journl:aamjaf00801_91-123

Access Statistics for this article

More articles in Asian Academy of Management Journal of Accounting and Finance (AAMJAF) from Penerbit Universiti Sains Malaysia Contact information at EDIRC.
Bibliographic data for series maintained by Journal Division, Penerbit Universiti Sains Malaysia ().