Asymmetric Information and Conglomerate Discount: Evidence from Spinoffs

• Main Authors: Jing, Pan, DING, David K., Charoenwong, C.
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2007
• Subjects: Finance and Financial Management; Portfolio and Security Analysis
• Online Access: https://ink.library.smu.edu.sg/lkcsb_research/709
• Institution: Singapore Management University

The existing literature argues that diversified firms may be undervalued due to information asymmetry between a firm’s management and the market. Splitting the firm’s divisions into multiple business components will facilitate the market valuation of each component more accurately. We investigate th...