The product market effects of hedge fund activism

• 成果类型: Article
• 署名作者: Aslan, Hadiye; Kumar, Praveen
• 署名单位: University System of Georgia; Georgia State University; University of Houston System; University of Houston
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2015.08.016
• 发表日期: 2016
• 页码: 226-248
• 关键词: HEDGE FUND ACTIVISM; Product markets; Spillover effects; Market shares; markups

摘要

We examine the product market spillover effects of hedge fund activism (HFA) on the industry rivals of target firms. HFA has negative real and stockholder wealth effects on the average rival firm. The effects on rivals' product market performance is commensurate with post-activism improvements in target's productivity, cost and capital allocation efficiency, and product differentiation. Financially constrained rivals accommodate these improvements but those facing high intervention threat respond effectively to them. The spillover effects are strengthened in less concentrated and low entry barrier industries. The results are robust to the alternative hypothesis of strategic target selection by hedge funds. (C) 2015 Elsevier B.V. All rights reserved.