While recent studies indicate that value-based management (VBM) helps owners in aligning managerial interests (i.e., decision-influencing role), little evidence is provided for its support decision-making decision-facilitating role). We investigate whether the depth of VBM implementation and contextual factors may determine VBM’s role. our research question on a dataset 1,774 divestitures by Eu...

Prior research has paid very little attention, if at all, to the risks and costs entailed in IT disintegration processes. In this study, we begin addressing this gap by studying how IT disintegration challenges posed by corporate divestitures affect the regulatory compliance risks and costs of divesting firms in the context of the Sarbanes-Oxley Act of 2002 (SOX). We hypothesize that firms with...

This paper investigates “legacy divestitures,” the sale or spinoff of a company’s original, or “legacy” business. The central tension considered in this work is that the historical presence of a firm’s legacy business should simultaneously make that unit very interdependent with the company’s remaining operations and make the firm’s managers highly likely to take those same interdependencies fo...

Let’s rethink. What is strategy? To many, strategy once meant selecting the most attractive product/ market segments and determining the appropriate level of investment in each. Many useful tools and concepts, developed largely during the 1970s, gave managers important insights into the comparative attractiveness of the business options they faced (Exhibit 1). These constructs, which characteri...

A number of authors have argued that the divestiture of AT&T did not reduce the rates of long distance telephone companies as often believed. However, the literature has offered few explanations as to why competition has not lowered rates. This study argues that rates have failed to fall due to the importance of search and switching costs in the industry. Using a panel data set of rates for the...

The Czech Republic, Hungary and Poland followed different strategies in the use of nonstandard methods of privatization. In regard to resrirurion, the Czech Republic carried out physical return of property, Hungary weakly implemented financial compensation and Poland has not yet approved a programme. Management and employee buyouts were eschewed in the Czech Republic, took the form of employee ...

Financial crises in emerging market economies induce diverging patterns of ownership stakes and subsequent divestiture rates among domestic foreign acquirers. We rationalize these empirical findings a tractable model where acquirers are subject to borrowing constraints. In contrast standard fire-sale effects operating for acquisitions by acquirers, acquisition firms shaped novel counteracting s...