Index Membership vs. Loss of Control: The Unification of Dual-Class Shares

Betzer, André ; Bongard, Inga van den ; Goergen, Marc

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Document Type: Working paper
Year of publication: 2013
The title of a journal, publication series: SSRN Working Paper Series
Place of publication: Rochester, NY
Publication language: English
Institution: Business School > ABWL u. Finanzierung (Theissen 2009-)
Subject: 330 Economics
Abstract: A change in the index selection rules of Deutsche Börse provides a unique opportunity to investigate the drivers behind the decision to abolish dual-class shares. As of June 2002, selection is based on the market capitalization of the free-float of the more liquid share class rather than the overall market capitalization. As a result, firms have had to reassess the benefits from their dual-class shares in the light of the costs from dropping out of their index. Our findings suggest that index membership significantly affects the controlling shareholder’s motivation to unify preferred and common stock
Additional information: Online-Ressource

Dieser Eintrag ist Teil der Universitätsbibliographie.

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