Tracking Stocks

Sabine Langner ()
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Sabine Langner: Albert-Ludwigs-Universität Freiburg

Schmalenbach Journal of Business Research, 2004, vol. 56, issue 7, 666-684

Abstract: Summary Tracking stocks are common stock of the firm that track the success of a particular business unit without changing the conglomerate structure. Thus, they try to combine the advantages of an external financing via the market and an internal financing. However, the structure evokes governance problems. This paper examines the design of tracking stocks and the resulting advantages and disadvantages. It further surveys the existing empirical literature on tracking stocks. The analysis suggests that tracking stocks are an equity structure that may add value for specific types of firms.

Keywords: G32; Corporate governance; success of business units; Tracking Stocks; Geschäftsbereichserfolg; Kontrollprobleme; Tracking Stocks (search for similar items in EconPapers)
Date: 2004
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DOI: 10.1007/BF03372754

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