Tunneling or value added? Evidence from mergers by Korean business groups

Journal of Finance

Volumn 57, Issue 6, 2002, Pages 2695-2740

  Bae, Kee Hong ^a   Kang, Jun Koo ^b   Kim, Jin Mo ^b  

^a Korea University   (South Korea)

^b MICHIGAN STATE UNIVERSITY   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

EID: 0042671365     PISSN: 00221082     EISSN: None     Source Type: Journal    
DOI: 10.1111/1540-6261.00510     Document Type: Article

References (45)

1. Amihud, Yakov, and Baruch Lev, 1981, Risk reduction as a managerial motive for conglomerate mergers, Bell Journal of Economics 12, 605-617.
2. Aoki, Masahiko, 1990, Toward an economic model of the Japanese firm, Journal of Economic Literature 28, 1-27.
3. Bae, Kee-Hong, and Baekin Cha, 1997, Price changes, trading volume and price limits, Advances in the Pacific-Basin Financial Markets 3, 21-37.
4. Barclay, Michael J., and Clifford G. Holderness, 1989, Private benefits from control of corporations, Journal of Financial Economics 25, 371-395.
5. Barclay, Michael J., Clifford G. Holderness, and Jeffery Pontiff, 1993, Private benefits from block ownership and discounts on closed-end funds, Journal of Financial Economics 33, 263-291.
6. Bertrand, Marianne, Paras Mehta, and Sendhil Mullainathan, 2000, Ferreting out tunneling: An application to Indian business groups, Working paper, M.I.T.
7. Bradley, Michael J., Anand Desai, and E. Han Kim, 1988, Synergistic gains from corporate acquisitions and their division between the stockholders of target and acquiring firms, Journal of Financial Economics 21, 3-40.
8. Chang, Saeyoung, 1998, Takeovers of privately held targets, methods of payment, and bidder returns, Journal of Finance 53, 773-784.
9. Claessens, Stijn, Simeon Djankov, and Larry H. P. Lang, 2000, The separation of ownership and control in East Asian corporations, Journal of Financial Economics 58, 81-112.
10. Friedman, Eric, and Simon Johnson, 2000, Tunneling and propping, Working paper, M.I.T.
11. Hoshi, Takeo, Anil Kashyap, and David Scharfstein, 1991, Corporate structure, liquidity, and investment: Evidence from Japanese industrial groups, Quarterly Journal of Economics 106, 33-60.
12. Jensen, Michael C., 1986, Agency costs of free cash flows, corporate finance, and takeovers, American Economic Review 76, 323-329.
13. Johnson, Simon, Rafael La Porta, Florencio Lopez-de-Silanes, and Andrei Shleifer, 2000, Tunneling, American Economic Review Papers and Proceedings 90, 22-27.
14. Kang, Jun-Koo, 1993, The international market for corporate control: Mergers and acquisitions of U.S. firms by Japanese firms, Journal of Financial Economics 34, 345-371.
15. Kang, Jun-Koo, 1998, Bank-centered corporate governance systems, Economic Analysis (Bank of Korea, in Korean) 4, 120-161.
16. Kang, Jun-Koo, and Anil Shivdasani, 1995, Firm performance, corporate governance, and top executive turnover in Japan, Journal of Financial Economics 38, 29-58.
17. Kang, Jun-Koo, Anil Shivdasani, and Takeshi Yamada, 2000, The effect of banks on investment decisions: An investigation of Japanese takeover bids, Journal of Finance 55, 2197-2218.
18. Kang, Jun-Koo, and René M. Stulz, 1996, How different is Japanese corporate finance? An investigation of the information content of new security issue, Review of Financial Studies 9, 109-139.
19. Kaplan, Steven N., 1994, Top executive rewards and firm performance: A comparison of Japan and the United States, Journal of Political Economy 102, 510-546.
20. Khanna, Tarun, and Krishna Palepu, 1997, Why focused strategies may be wrong for emerging markets, Harvard Business Review, July-August, 41-51.
21. Khanna, Tarun, and Krishna Palepu, 1999, Emerging market business groups, foreign investors, and corporate governance, Working paper #6955, NBER.
22. Khanna, Tarun, and Krishna Palepu, 2000, Is group affiliation profitable in emerging markets: An analysis of diversified Indian business groups, Journal of Finance 55, 867-891.
23. Kim, E. Han, and Young Kee Lee, 1990, Issuing stocks in Korea, Pacific Basin Capital Markets Research 1, 243-253.
24. Kim, E. Han, and Vijay Singal, 2000, Stock market openings: Experience of emerging economies, Journal of Business 73, 25-66.
25. Kim, Sung-Hoon, 1999, The effect of foreign acquisitions on stock returns, Working paper in Korean, Korea University.
26. Korea Herald, 1999, LG Securities in merger talks with LG Merchant Bank, May 22, p. 12.
27. Korea Herald, 1999, LG to merge brokerage unit with merchant bank, August 24, p. 9.
28. Korea Herald, 2000, Court ruling suspends Samsung Group's father-to-son power transfer attempts, May 11, p. 8.
29. Lang, Larry, René M. Stulz, and Ralph A. Walkling, 1989, Tobin's q and the gains from successful tender offers, Journal of Financial Economics 24, 137-154.
30. La Porta, Rafael, Florencio Lopez-de-Silanes, and Andrei Shleifer, 1999, Corporate ownership around the world, Journal of Finance 54, 471-517.
31. La Porta, Rafael, Florencio Lopez-de-Silanes, and Andrei Shleifer, 2000, Investor protection and corporate governance, Journal of Financial Economics 58, 3-27.
32. La Porta, Rafael, Florencio Lopez-de-Silanes, Andrei Shleifer, and Robert Vishny, 1997, Legal determinants of external finance, Journal of Finance 52, 1131-1150.
33. La Porta, Rafael, Florencio Lopez-de-Silanes, Andrei Shleifer, and Robert Vishny, 1998, Law and finance, Journal of Political Economy 106, 1113-1155.
34. La Porta, Rafael, Florencio Lopez-de-Silanes, and Guillermo Zamarripa, 2000, Soft lending and hard landing: Related lending in Mexico, Working paper, Harvard University.
35. Maloney, Michael T., Robert E. McCormick, and Mark L. Mitchell, 1993, Managerial decision making and capital structure, Journal of Business 66, 189-217.
36. Morck, Randall, Andrei Shleifer, and Robert W. Vishny, 1990, Do managerial objectives drive bad acquisitions? Journal of Finance 45, 31-48.
37. Prowse, Stephen D., 1990, Institutional investment patterns and corporate financial behavior in the United States and Japan, Journal of Financial Economics 27, 43-66.
38. Scharfstein, David S., and Jeremy C. Stein, 2000, The dark side of internal capital market: Divisional rent-seeking and inefficient investment, Journal of Finance 55, 2537-2564.
39. Servaes, Henri, 1991, Tobin's q and the gains from takeovers, Journal of Finance 46, 409-419.
40. Sheard, Paul, 1989, The main bank system and corporate monitoring and control in Japan, Journal of Economic Behavior and Organization 11, 399-422.
41. Shin, Hyun-Han, and Young S. Park, 1999, Financing constraints and internal capital markets: Evidence from Korean chaebols, Journal of Corporate Finance 5, 169-191.
42. Shleifer, Andrei, and Robert W. Vishny, 1997, A survey of corporate governance, Journal of Finance 52, 737-783.
43. Shleifer, Andrei, and Daniel Wolfenzon, 2000, Investor protection and equity markets, Working paper, Harvard University.
44. Stein, Jeremy C., 1997, Internal capital markets and the competition for corporate resources, Journal of Finance 52, 111-133.
45. Wolfenzon, Daniel, 1999, A theory of pyramidal ownership, Working paper, University of Michigan.