 Family Firm Value in the Acquisition Context: A Signaling Theory PerspectiveMartin Tao-Schuchardt, Frederik J. Riar and Nadine Kammerlander Entrepreneurship Theory and Practice, 2023, vol. 47, issue 4, 1200-1232 Abstract: Drawing on signaling theory, we explore the signaling effect of family firm status on firm value in the acquisition context as well as important contingencies influencing the signal’s effectiveness. Based on a sample of 486 observations of acquisitions in France, Germany, Italy, and Spain from 2011 to 2019, our empirical results suggest that acquirers purchase family firms at a higher firm value than non-family firms. This relationship is moderated by the target firm’s financial performance (i.e., high vs. low) and listing status (i.e., private vs. public) prior to an acquisition, as well as the type of acquirer (i.e., financial vs. non-financial) and the acquirer’s geographic location (i.e., cross-border vs. domestic). Our study’s findings suggest that family firm value is driven not only by the characteristics of the family firms that become acquired but also by the characteristics of the acquirers as they influence the effectiveness of the family firm signal. Keywords: family firm; family-owned business; firm value; EBITDA multiple; acquisitions; socioemotional wealth; signaling theory (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:sae:entthe:v:47:y:2023:i:4:p:1200-1232 DOI: 10.1177/10422587221135761 Access Statistics for this article More articles in Entrepreneurship Theory and Practice |
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