Chen, Shenglan and Li, Jing and Liu, Xiaoling and Yan, Cheng (2022) Mutual fund centrality and the remote acquisitions of listed firms in China*. The European Journal of Finance, 29 (14). pp. 1-29. DOI https://doi.org/10.1080/1351847x.2022.2141130
Chen, Shenglan and Li, Jing and Liu, Xiaoling and Yan, Cheng (2022) Mutual fund centrality and the remote acquisitions of listed firms in China*. The European Journal of Finance, 29 (14). pp. 1-29. DOI https://doi.org/10.1080/1351847x.2022.2141130
Chen, Shenglan and Li, Jing and Liu, Xiaoling and Yan, Cheng (2022) Mutual fund centrality and the remote acquisitions of listed firms in China*. The European Journal of Finance, 29 (14). pp. 1-29. DOI https://doi.org/10.1080/1351847x.2022.2141130
Abstract
We empirically investigate the effect of the centrality of mutual funds (MFs) on the holding network of each listed firm in cross-province acquisitions in China using a unique dataset covering the 2010–2019 period. We find a positive association between the centrality of MFs and the likelihood and value of cross-province acquisitions made by the listed firm, especially when the central blockholder MF pays corporate site visits, when target firms are difficult for the acquirer to reach, and when the central blockholder MF is low-risk or high-performance. We also show that blockholder centrality improves the market valuation and post-acquisition performance of cross-province acquisitions. These results support the notion that a MF with the largest blockholder centrality increases the value of the listed firms it owns by alleviating information asymmetry in cross-province acquisitions. Collectively, our evidence highlights the advisory role of a blockholder network for listed firms.
Item Type: | Article |
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Uncontrolled Keywords: | Mutual fund; centrality; acquisition; China |
Divisions: | Faculty of Social Sciences Faculty of Social Sciences > Essex Business School |
SWORD Depositor: | Unnamed user with email elements@essex.ac.uk |
Depositing User: | Unnamed user with email elements@essex.ac.uk |
Date Deposited: | 06 Jun 2023 16:35 |
Last Modified: | 30 Oct 2024 15:50 |
URI: | http://repository.essex.ac.uk/id/eprint/33836 |
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