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Dual-class firms, M&As and SOX

Author

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  • Chourou, Lamia
  • Hossain, Ashrafee T.
  • Kryzanowski, Lawrence

Abstract

By analyzing a large sample of M&A deals undertaken by domestic dual-class acquirers in the United States (1996–2009), this study finds that deals were more value-enhancing for acquiring firm shareholders, both in the short- and long-term, in the aftermath of the passage of the Sarbanes-Oxley Act (SOX). This study provides evidence that the transparency measures mandated by SOX had positive and tangible incremental benefits evidenced by enhanced performance by supposedly ‘poorly governed’ dual-class acquirers relative to their single-class counterparts.

Suggested Citation

  • Chourou, Lamia & Hossain, Ashrafee T. & Kryzanowski, Lawrence, 2019. "Dual-class firms, M&As and SOX," The Quarterly Review of Economics and Finance, Elsevier, vol. 71(C), pages 176-187.
    • Handle: RePEc:eee:quaeco:v:71:y:2019:i:c:p:176-187
    DOI: 10.1016/j.qref.2018.08.005
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    More about this item

    Keywords

    Dual-class firms; Transparency; Corporate governance; Mergers and acquisitions; SOX;
    All these keywords.

    JEL classification:

    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation

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