Divestiture, Market Valuation, and Strategy.

1 December 1984

journal article
Published by Academy of Management in The Academy of Management Journal

Vol. 27 (4) , 830-840
https://doi.org/10.2307/255881

Abstract

An empirical study of 78 divestitures examines the relationship between type of divestiture and financial market valuation. It was found that divestitures linked to corporate or business level strategies in company publications were valued positively by the market; divestitures portrayed as the sale of unwanted units in the absence of defined strategic goals were valued negatively.

Keywords

CORPORATE DIVESTITURE
ASSET ALLOCATION -- MANAGEMENT
DIVIDEND REINVESTMENT
PORTFOLIO MANAGEMENT (INVESTMENTS) -- ECONOMIC ASPECTS
INVESTMENTS -- MANAGEMENT
SECURITIES MARKETS
STRATEGIC PLANNING -- ECONOMIC ASPECTS
MARKET VALUE
CORPORATIONS -- VALUATION
CAPITAL MARKET -- ECONOMIC ASPECTS

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