Large Shareholding and Firm Value in the Alternative Investment Market (AIM)
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This paper investigates the impact of non-managerial and managerial blockholders on the value of the firms listed in the Alternative Investment Market (AIM). This study mainly investigates whether the effect of blockholders on firm value is due to the AIM high ownership concentration and low investor protection. The primary empirical finding, using GMM, justifies that non-managerial and managerial blockholders in the AIM affect the firm value in different ways. Non-managerial blockholders in the AIM improve the firm value by monitoring managers when their block sizes are up to 32%. However, when their block sizes exceed 32%, the blockholders expropriate other shareholders.
KeywordsCorporate governance Alternative Investment Market (AIM) Managerial blockholders Firm value Tobin’s Q Generalized Method of Moments (GMM)
JEL ClassificationG23 G32
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