Changes in Controlling Shareholders’ Holdings: Do they Entail Financial Tunneling?
Menachem Abudy () and
Beni Lauterbach ()
A chapter in International Corporate Governance, 2015, vol. 18, pp 47-63 from Emerald Publishing Ltd
Abstract We examine changes in controlling shareholder holdings, looking for evidence of financial tunneling (unfair wealth transfers from public investors to controlling shareholders). Our sample comprises yearly data during 2000–2011 on 75 large Israeli companies. We find that controlling shareholders are successful in timing the stock market – there exists a significant negative correlation between changes in the mean controlling shareholders’ equity holdings and market return. There is also some evidence that controlling shareholders increase (decrease) their holdings before years of positive (negative) excess returns in their shares. However, statistically significant mean excess returns are documented only after decreases in controlling shareholders’ holdings. Thus, we offer only limited support for the financial tunneling hypothesis.
Keywords: Controlling shareholders; financial tunneling; G32; G34 (search for similar items in EconPapers)
References: Add references at CitEc
Citations: View citations in EconPapers (3) Track citations by RSS feed
Downloads: (external link)
http://www.emeraldinsight.com/10.1108/S1569-373220 ... RePEc&WT.mc_id=RePEc (text/html)
Access to full text is restricted to subscribers
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:eme:afeczz:s1569-373220150000018002
Ordering information: This item can be ordered from
Emerald Group Publishing, Howard House, Wagon Lane, Bingley, BD16 1WA, UK
http://www.emeraldgr ... ies.htm?id=1569-3732
Access Statistics for this chapter
More chapters in Advances in Financial Economics from Emerald Publishing Ltd
Bibliographic data for series maintained by Charlotte Maiorana ().