Government Ownership and Managers’ Role: Effect to Acquisition Return Among High-Technology Companies

Norhamiza Ishak and Hanita Kadir Shahar and Kamarun Nisham Taufil Mohd (2023) Government Ownership and Managers’ Role: Effect to Acquisition Return Among High-Technology Companies. Asian Academy of Management Journal of Accounting and Finance, 19 (2). pp. 293-315. ISSN 1985-8299

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This study investigates the effect of high-technology (high-tech) company acquisitions and GLIC ownership on shareholders’ value creation. Study samples for empirical analyses were carried out using the market-model event-study and multivariate analysis on studies published between 2011 and 2018. The findings indicate that; (i) The CAR for high-tech acquiring firms for the three-day event window (–1,1), five-day event window (–2, +2) and 11-day event window led to significant positive returns, with at least at 10% level, signifying that investors have a favorable reaction towards short-term high tech acquisitions; (ii) The relationship between the GLICs’ Institutional Block holders (BPSVGLIC) and executive director (FRACEXEC) was found to affect the abnormal returns significantly negatively at a minimum 5% significance level. These results provide two practical implications; firstly, investors gain abnormal returns from their investment in high-tech acquiring companies, and secondly, firms with greater ownership stakes in GLICs could experience value destruction.

Item Type: Article
Keyword: High-tech acquisitions, Government-linked investment company, GLIC, Cumulative abnormal return, CAR, Malaysia
Subjects: H Social Sciences > HB Economic theory. Demography > HB1-3840 Economic theory. Demography
H Social Sciences > HG Finance > HG1-9999 Finance > HG4501-6051 Investment, capital formation, speculation > HG4530 Investment companies. Investment trusts. Mutual funds
Department: FACULTY > Labuan Faculty of International Finance
Date Deposited: 05 Mar 2024 10:33
Last Modified: 05 Mar 2024 10:33

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