Evidence of Wealth Effect of Corporate Spin-Offs in China

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Yi-Hong Lin
Yi-Hong Lin
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Teik-Wei Yoon
Teik-Wei Yoon
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Annuar Bin Md Nassir
Annuar Bin Md Nassir
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Chung-Sin Yoon
Chung-Sin Yoon

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Evidence of Wealth Effect of Corporate Spin-Offs in China

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Abstract

Is corporate spin-offs less attended as a wealth-generating asset restructuring in the People’s Republic of China (China)?. Was the wealth effect of China’s corporate spin-off occurring in the State Capital Economy? Although China’s Initial Public Offering (IPO) incidences and volumes are vigorous, China’s corporate spin-offs started late and lack extensive applications. In July 2020 alone, a total of seventy-five companies completed IPO in mainland China and abroad despite the outbreak of the COVID-19 pandemic. This paper aimed to provide evidence on the wealth effect of the combination of China corporate spin-off announcements, parent and subsidiary. We took twenty-four Chinese listed companies that have been successfully spin-off as a whole to explore the corporate spin-off wealth effect on their market value, and the empirical results of positive returns were convincing. Compared with the prior corporate spin-off researches in China, this paper is more comprehensive as we examined the shareholders’ wealth effect of the corporate spin-off announcements from the years 2000 to 2018 in the Shanghai Stock Exchange (SSE) and Shenzhen Stock Exchange (SZSE).

References

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Funding

No external funding was declared for this work.

Conflict of Interest

The authors declare no conflict of interest.

Ethical Approval

No ethics committee approval was required for this article type.

Data Availability

Not applicable for this article.

How to Cite This Article

Yi-Hong Lin. 2021. \u201cEvidence of Wealth Effect of Corporate Spin-Offs in China\u201d. Global Journal of Human-Social Science - A: Arts & Humanities GJHSS-A Volume 21 (GJHSS Volume 21 Issue A7): .

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Journal Specifications

Crossref Journal DOI 10.17406/GJHSS

Print ISSN 0975-587X

e-ISSN 2249-460X

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GJHSS-A Classification: FOR Code: 950199
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v1.2

Issue date

June 11, 2021

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en
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Is corporate spin-offs less attended as a wealth-generating asset restructuring in the People’s Republic of China (China)?. Was the wealth effect of China’s corporate spin-off occurring in the State Capital Economy? Although China’s Initial Public Offering (IPO) incidences and volumes are vigorous, China’s corporate spin-offs started late and lack extensive applications. In July 2020 alone, a total of seventy-five companies completed IPO in mainland China and abroad despite the outbreak of the COVID-19 pandemic. This paper aimed to provide evidence on the wealth effect of the combination of China corporate spin-off announcements, parent and subsidiary. We took twenty-four Chinese listed companies that have been successfully spin-off as a whole to explore the corporate spin-off wealth effect on their market value, and the empirical results of positive returns were convincing. Compared with the prior corporate spin-off researches in China, this paper is more comprehensive as we examined the shareholders’ wealth effect of the corporate spin-off announcements from the years 2000 to 2018 in the Shanghai Stock Exchange (SSE) and Shenzhen Stock Exchange (SZSE).

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Evidence of Wealth Effect of Corporate Spin-Offs in China

Yi-Hong Lin
Yi-Hong Lin
Teik-Wei Yoon
Teik-Wei Yoon
Annuar Bin Md Nassir
Annuar Bin Md Nassir
Chung-Sin Yoon
Chung-Sin Yoon

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