Like father, like son: Who creates listed subsidiaries?

Hichem Boulifa, Konari Uchida

Research output: Contribution to journalArticlepeer-review

1 Citation (Scopus)


Equity carve-outs and spin-offs generate listed subsidiaries that embrace conflicts of interests between controlling and minority shareholders. We find robust evidence that long-tenure managers tend to conduct these asset divestitures, especially when the divesting firm has a concentrated ownership structure. The result suggests that managers with the opportunity to extract private benefits establish entities that provide such opportunities. Meanwhile, large shareholders prevent managers from conducting these divestitures when they have sufficiently large cash flow rights. We find no evidence that firms launching listed subsidiaries achieve better financial outcomes than asset sell-off firms. Problematic entities in corporate governance further create such entities.

Original languageEnglish
Article number101205
JournalJournal of the Japanese and International Economies
Publication statusPublished - Jun 2022

All Science Journal Classification (ASJC) codes

  • Finance
  • Economics and Econometrics
  • Political Science and International Relations


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