Corporate spinoffs and information asymmetry between investors

Liquidity and firm characteristics: Evidence from mergers and acquisitions

“…Their results suggest an improvement in liquidity. However, Huson and MacKinnon (2003) examine spinoffs and find that those spinoffs that increase firm focus are associated with an increase…”

“…Huson and MacKinnon (2003) suggest that firm level diversification improves liquidity whereas Gilson et al (2001) suggest just the opposite. We provide results that are consistent with Krishnaswami and Subramaniam (1999) and Thomas (2002), who find no relation.…”

“…4 Amihud et al (1999), Krishnaswami and Subramaniam (1999), and Gilson et al (2001) document changes in the trading environment around events that change firm characteristics. Huson and MacKinnon (2003) employ an approach similar to ours in their analysis of spinoffs, but control for a much smaller set of firm characteristics. 2 In effect, our methodology combines features of both event studies and cross-sectional regressions.…”

Entrepreneurship, University Research, and Growth: European North vs. South

“…Transaction costs and the impact on the prices of transactions are also higher. Indeed alterations in the information environment benefit more the parties who have the advantage in obtaining information (Huson & MacKinnon, 2003). Ultimately, the transaction uncertainty resulting from asymmetrical information gives an uncertainty premium to transaction costs.…”

Gains from equity carve-outs and subsequent events

“…Prior empirical research finds that divestitures, such as sell-offs and spin-offs, enhance firm performance (e.g., Ofek, 1995, 1996;Burch and Nanda, 2003;John and Ofek, 1995;Mulherin and Boone, 2000;Schlingemann et al, 2002;Lamont and Polk, 2002;Huson and MacKinnon, 2003). In the past decade, U.S. firms that conducted corporate restructurings related to divestitures refocused on their core businesses and tended to improve their performance.…”