Institutional Ownership and Acquiring Firms’ Performance: Evidence from Taiwan

• Main Authors: Lin, Chung Wei, 林忠緯
• Other Authors: Chen, Wei Kuang
• Format: Others
• Language: zh-TW
• Published: 2017
• Online Access: http://ndltd.ncl.edu.tw/handle/5unp3e

碩士 === 國立政治大學 === 金融學系 === 105 === In this paper, we examine the relationship between different types of institutional ownership and acquiring firms’ performance on M&A activities. We found that the monitoring effect is weak in the short-term horizon; however, there is a significantly positive relationship between foreign institutional ownership and long-term performance on M&A activities. More specifically, the result shows that the ownership of foreign mutual funds, domestic foundations and securities dealers is positively related to M&A performance, while the ownership of domestic mutual funds has a significantly negative relation with M&A performance. At the same time, we have a consistent result from change in institutional ownership. While the relationship between change in most kinds of institutional ownership and long-term M&A performance is weak, the change in domestic mutual funds’ ownership has a strong negative relation with M&A performance. This paper shows that foreign investors’ monitoring has a positive influence on firm’s M&A decision. On the contrary, domestic mutual funds is not a good monitor that their holdings lead to poor M&A performance.