Ownership Identity and Mitigation of Diversification Discount: Evidence from Malaysia

  • Kian-Tek Lee Business School, Sunway University
  • Chee-Wooi Hooy School of Management, Universiti Sains Malaysia

Abstract

This paper examines the mitigation effect of the ultimate ownership identity on the diversification discount under the emerging market’s institutional setting. Using a sample of non-financial listed firms in Malaysia from 2002 to 2013, the study reveals that government ultimate ownership is able to mitigate the diversification discount better than family ultimate ownership by 5 to 43 percent, whereas family ultimate ownership is better than foreign ultimate ownership in mitigating the diversification discount by 30 to 118 percent. Our study also finds that a high degree of ownership concentration gives rise to the diversification discount.

Published
2018-05-14
How to Cite
LEE, Kian-Tek; HOOY, Chee-Wooi. Ownership Identity and Mitigation of Diversification Discount: Evidence from Malaysia. Malaysian Journal of Economic Studies, [S.l.], v. 55, n. 1, p. 97-113, may 2018. ISSN 1511-4554. Available at: <http://mjes.um.edu.my/index.php/MJES/article/view/11767>. Date accessed: 14 nov. 2018. doi: https://doi.org/10.22452/MJES.vol55no1.6.
Section
Articles