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We investigate the effect of pyramidal ownership and family control in investment-cash flow sensitivity of Brazilian firms using financial constraint indexes to a priori classify firms. For constrained firms, we find that family control does not directly influence the investment-cash flow sensitivity, while for unconstrained firms, Family control shows a negative effect in investment decisions. However, the active involvement of the controlling family in the board increases investment-cash flow of unconstrained firms, possibly aggravating agency problems. Regarding the pyramidal ownership, we provide evidences consistent with the idea of internal transfer of funds among firms belonged to the arrangement structure.

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This study investigates the investment-cash flow sensitivity of a sample of 356 Brazilian listed firms on the period of 1997-2010, considering the ownership and control structure. Firms are grouped into underinvestment and overinvestment, and reclassified according to industrial investment opportunities. Using a version of the accelerator investment model, estimated by the System GMM, the results show that the investment-cash flow sensitivity may indicate asymmetric information, investment opportunities and agency problems of free cash flow. Specifically, it is discussed that the overinvestment may be signaling high investment opportunities or agency problems of free cash flow. The purpose of this study is also investigate whether family control, pyramidal ownership structure, and pyramidal controlled by families (pyramidal-family firms) can influence the level of internal capital used to finance investments. The results show that the investment of underinvestment firms with high industrial investment opportunities may be not sensitive to cash flow when the excess of control rights over cash flow rights of the largest ultimate shareholder is lower. However, for overinvestment firms with low industrial investment opportunities, the family control and pyramidal-family may intensify the investment-cash flow sensitivity when the excess of control rights is high. For lower levels of excess of control rights, the results support that higher investment-cash flow sensitivity of overinvestment firms with high industrial investment opportunities may signal profitability potential of family firms. As an additional analysis, it is also investigated whether the relationship between investment-cash flow sensitivity and the excess of control rights is non-linear. The results confirm the non-linearity of this relationship, except to pyramidal-family firms into the overinvestment group with low industrial investment opportunities.

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O presente estudo fundamenta-se nos balanços e demonstrativos dos resultados da Oi S.A. entre os anos de 2002 e 2016 para analisar os fatores que a levaram a declarar recuperação judicial. Os indicadores financeiros sugerem que a fragilidade da Oi S.A. é proveniente da captação de dívida de curto prazo. Em meados de 2016 houve uma tentativa de reestruturação da dívida da empresa, mas o fato de a companhia demonstrar insustentabilidade também pode ter influenciado na captação de recursos. Soma-se a isso, as constantes quedas de rentabilidade, instabilidade de governança corporativa, constantes multas aplicadas à empresa e os processos judiciais enfrentados, também agravaram a saúde financeira da empresa.