Corporate Restructuring in Japan: An Event-Study Analysis

Jorge Chan-Lau

No 2001/202, IMF Working Papers from International Monetary Fund

Abstract: The implementation of the Commercial Rehabilitation Law (CRL) on April 1, 2000 was considered a key event in setting up the official infrastructure supporting corporate restructuring in Japan. This study evaluates the stock price impact of restructuring announcements before and after the CRL implementation using event-study analysis. Following the CRL implementation, the results suggest an improvement in market credibility of restructuring announcements based on improvements in disclosure, mergers, and to a lesser extent, labor force reductions. In contrast, credibility of restructuring announcements aimed at reducing excess capital deteriorated.

Keywords: WP; firm; fixed asset; stock price; Japan; corporate restructuring; corporate governance; event-study analysis; stock price effect; price impact; a number of company; effects of labor force reduction plan; CRL period; firms in the bank group; Asset prices; Labor force; Corporate sector; Commercial banks (search for similar items in EconPapers)
Pages: 15
Date: 2001-12-01
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Journal Article: Corporate restructuring in Japan: an event-study analysis (2002)
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