Internal capital market mergers in weak external market environment: An emerging market evidence

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dc.contributor.author Huang, Wei
dc.contributor.author Zhang, Hong
dc.contributor.author Goyal, Abhinav
dc.contributor.author Laws, Jason
dc.date.accessioned 2020-01-22T12:14:42Z
dc.date.available 2020-01-22T12:14:42Z
dc.date.issued 2019-07-31
dc.identifier.citation Huang, W., Zhang, H., Goyal, A. and Laws, J. (2019) 'Internal capital market mergers in weak external market environment: An emerging market evidence', International Journal of Finance & Economics, 24(4), pp. 1486-1505. doi: 10.1002/ijfe.1739 en
dc.identifier.volume 24 en
dc.identifier.issued 4 en
dc.identifier.startpage 1486 en
dc.identifier.endpage 1505 en
dc.identifier.issn 1076-9307
dc.identifier.uri http://hdl.handle.net/10468/9553
dc.identifier.doi 10.1002/ijfe.1739 en
dc.description.abstract Using Chinese split‐share structure reform as backdrop, we study the alternative theories explaining the change in objectives of internal capital markets (ICMs) after regulatory intervention. Focusing on related party merger and acquisitions, as the primary form of ICM transactions in China, we document significantly positive performance improvement among the acquiring firms around related party than nonrelated party merger and acquisitions in the period following the split‐share structure reform. This evidence is particularly stronger among acquirers with lower institutional shareholding. Our findings are invariant to the length of performance evaluation window, matched samples, model specifications, acquirers' ownership structure, and business group affiliations. After controlling for alternative channels of tunnelling and propping, contrary to the popular belief, our findings support the bright‐side view of ICMs postregulatory intervention in an emerging market set‐up. en
dc.format.mimetype application/pdf en
dc.language.iso en en
dc.publisher Wiley en
dc.relation.uri https://onlinelibrary.wiley.com/doi/abs/10.1002/ijfe.1739
dc.rights © 2019 John Wiley & Sons, Ltd. This is the peer reviewed version of the following article: Huang, W, Zhang, H, Goyal, A, Laws, J. Internal capital market mergers in weak external market environment: An emerging market evidence. Int J Fin Econ. 2019; 24: 1486– 1505, which has been published in final form at https://doi.org/10.1002/ijfe.1739 This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Self-Archiving. en
dc.subject China en
dc.subject Internal capital market en
dc.subject M&A en
dc.subject Related party en
dc.subject Tunnelling en
dc.title Internal capital market mergers in weak external market environment: An emerging market evidence en
dc.type Article (peer-reviewed) en
dc.internal.authorcontactother Abhinav Goyal, Cork University Business School, University College Cork, Cork, Ireland. +353-21-490-3000 Email: abhinav.goyal@ucc.ie en
dc.internal.availability Full text available en
dc.check.info Access to this article is restricted until 24 months after publication by request of the publisher en
dc.check.date 2021-07-31
dc.date.updated 2020-01-22T12:00:25Z
dc.description.version Accepted Version en
dc.internal.rssid 500175726
dc.description.status Peer reviewed en
dc.identifier.journaltitle International Journal of Finance and Economics en
dc.internal.copyrightchecked Yes
dc.internal.licenseacceptance Yes en
dc.internal.IRISemailaddress abhinav.goyal@ucc.ie en


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