Family control influences on divestment stock market performance

Yosra Meddeb (), Majdi Karmani, Aymen Habib and Imene Zarrouki
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Yosra Meddeb: ESPI2R - Laboratoire ESPI2R Research in Real Estate [Marseille] - ESPI - Ecole Supérieure des Professions Immobilières

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Abstract: This paper studies the relationship between family control and the stock market performance of divestitures on a sample of listed firms in France. First, event study methodology was used to compare the short-term stock market performance of divestments made by family firms and their non-family counterparts. Then, linear regression was applied to study the effects of family control on corporate stock performance. The results show that divestments undertaken by family firms generate significantly higher performance than those undertaken by non-family firms. These results are justified by the specificities of companies controlled and managed by family members. Indeed, family firms only divest when the benefits of the operation cover the financial and socio-emotional costs.

Keywords: divestment; stock market performance; socio-emotional costs.; family control; familiness; family manager; ownership; Family business (search for similar items in EconPapers)
Date: 2024
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Published in International Journal of Business Governance and Ethics, inPress, 1 (1), ⟨10.1504/IJBGE.2024.10065432⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05323943

DOI: 10.1504/IJBGE.2024.10065432

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