Determinants of Foreign Ownership in Newly Privatized Companies in Transition Economies

Posted: 13 Aug 2001

See all articles by Christopher W. Anderson

Christopher W. Anderson

University of Kansas - School of Business

Tomas Jandik

University of Arkansas - Sam M. Walton College of Business

Anil K. Makhija

Ohio State University (OSU) - Department of Finance

Abstract

We investigate determinants of foreign ownership in newly privatized firms. We analyze data on privatized Czech firms to address two related general questions. First, what characteristics distinguish transition firms that attract a foreign investor? Second, how do firm-specific characteristics influence the size of the foreign equity stake? Our results suggest that foreign investors i) seek safe, profitable firms in which they can exert unchallenged influence on corporate governance and then ii) structure their equity stakes to mitigate agency costs and political risk.

Suggested Citation

Anderson, Christopher W. and Jandik, Tomas and Makhija, Anil K., Determinants of Foreign Ownership in Newly Privatized Companies in Transition Economies. Available at SSRN: https://ssrn.com/abstract=274400

Christopher W. Anderson

University of Kansas - School of Business ( email )

1300 Sunnyside Ave
Lawrence, KS 66045
United States
785-864-7340 (Phone)
785-864-5328 (Fax)

HOME PAGE: http://www.business.ku.edu/gen/bschool_generated_pages/Anderson_Christopher_p1587.html

Tomas Jandik

University of Arkansas - Sam M. Walton College of Business ( email )

WCOB 302
Fayetteville, AR 72701
United States
479-575-6147 (Phone)

Anil K. Makhija (Contact Author)

Ohio State University (OSU) - Department of Finance ( email )

2100 Neil Avenue
Columbus, OH 43210-1144
United States
614-292-1899 (Phone)

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