Fire sale discount: Evidence from the sale of minority equity stakes

• 成果类型: Article
• 署名作者: Dinc, Serdar; Erel, Isil; Liao, Rose
• 署名单位: Rutgers University System; Rutgers University New Brunswick; Rutgers University Newark; University System of Ohio; Ohio State University
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2017.06.009
• 发表日期: 2017
• 页码: 475-490
• 关键词: Fire sale; liquidity; Distressed sale; Price recovery

摘要

Most empirical studies estimate the impact of fire sales either without the benefit of market prices from frequent trades, as with aircraft sales, or without observing transaction prices, as with the forced sales of equity securities by mutual funds facing outflows. We observe both by studying firms' sales of minority equity stakes in publicly listed third parties. We estimate the distressed sale discount to be about 8% while controlling for liquidity and for industry, or about double the 4% estimated for equity sales by distressed mutual funds. The discount becomes 13-14% if the stake sold is more than 5% of the firm or is sold as a block. Prices recover after distressed sales. (c) 2017 Published by Elsevier B.V.