Investigating the Effects of Corporate Diversification Using the Berger and Ofek Methodology: An Application of Turkey

Emel Yucel, Mehmet Ozmen and Yildirim Beyazit Onal

Journal of BRSA Banking and Financial Markets, 2012, vol. 6, issue 2, 147-184

Abstract: This paper examines effects of corporate diversification on firm value using methodology of Berger and Ofek (1995) excess value measures based on assets and sales multiples. We match diversified firms and single-segment firms traded in National Market of ISE during the period of 2005-2010 in order to examine the possible effects of diversification on the firm value in terms of increasing or decreasing. According to the results of balanced panel data regression analyses, diversified firms trade at average diversification premium comparing to similar single segment firms. The results underscored the consistency between diversification measures such as Jacquemin-Berry entropy index, Berry-Herfindahl index and line of business data.

Keywords: Corporate Diversification; Excess Value; Berry-Herfindahl Index; Jacquemin-Berry Entropy Index; Berger and Ofek's Method (search for similar items in EconPapers)
JEL-codes: G32 G34 (search for similar items in EconPapers)
Date: 2012
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.bddk.org.tr/Content/docs/bddkDergiTr/dergi_0012_07.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:bdd:journl:v:6:y:2012:i:2:p:147-184

Access Statistics for this article

More articles in Journal of BRSA Banking and Financial Markets from Banking Regulation and Supervision Agency Contact information at EDIRC.
Bibliographic data for series maintained by Sumeyye Azize CENGIZ ().