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The Effects of Ownership Concentration and Origin on Listed Firms’ Value: Empirical Evidence from Romania

Author

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  • Georgeta Vintila

    (The Bucharest University of Economic Studies,)

  • Stefan Cristian Gherghina

    (The Bucharest University of Economic Studies,)

  • Mihai Nedelescu

    (Romanian-American University)

Abstract

This paper aims at exploring the relationship between ownership concentration and firm value by using panel data for firms listed on the Bucharest Stock Exchange (BSE). Additionally, we investigate the influence of ownership origin on firm value. Results drawn from a longitudinal analysis of a sample of all BSE listed companies, except for financial firms, provide support for a nonlinear relationship between the percentage of shares held by the three largest shareholders, considered individually, and firm value. Also, the nonlinear relationship is confirmed for the sum of holdings of the two largest shareholders, while the sum of holdings of the three largest shareholders exhibit a positive influence on firm value. Finally, if we consider the ownership origin, the results provide support for a positive relationship between the residence of the largest shareholder and firm value, while the influence of the sum of foreign investors’ holdings on firm value is nonlinear.

Suggested Citation

  • Georgeta Vintila & Stefan Cristian Gherghina & Mihai Nedelescu, 2014. "The Effects of Ownership Concentration and Origin on Listed Firms’ Value: Empirical Evidence from Romania," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(3), pages 51-71, October.
    • Handle: RePEc:rjr:romjef:v::y:2014:i:3:p:51-71
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    More about this item

    Keywords

    corporate governance; ownership concentration; ownership origin; firm value; panel data analysis;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance

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