Ownership structure and acquirers performance: Family vs. non-family firms

Houssam Bouzgarrou (1) , Patrick Navatte (1)

1 CREM - Centre de recherche en économie et management

This paper investigates the impact of family control on French acquirers' performance.We consider a sample of 239 acquisitions undertaken by French listed companies between January 1997 and December 2006. Comparing both, short-termand long-termperformance,we find that family-controlled firms outperformnon-family firms. We find that the relationship depends on the control level. The higher operating performance of family firms is statistically significant for an intermediate level of control. Around the announcement date, family firms with a high level of control outperform non-family firms. Using the calendar time approach, we find that long-term stock performance of family firms is positive and statistically significant. Robustness tests showthat our findings seem to not be driven by the endogeneity problem. Finally, we find that family wedge, due to the use of the pyramidal structure and the double voting rules, has no statistical significant effect.

Mots clés: Acquisitions; family firms; agency theory; stock performance; operating performance

Domaines: Economies et finances

Houssam Bouzgarrou, Patrick Navatte. Ownership structure and acquirers performance: Family vs. non-family firms. International Review of Financial Analysis, 2013, 27, pp.123-134. ⟨10.1016/j.irfa.2013.01.002⟩. ⟨halshs-00801736⟩