Employee Stock Ownership Plans, Common Stock Wealth Effects and Stock Price Variability
Abstract
The objective of this paper is to document the impact of several types of ESOP announcements on shareholder wealth. The market welcomes the news of initiation ESOPs, nonleveraged ESOPs and ESOPs implemented by firms with B‐BAA Moody's bond rating. However, the market indifferently responds to announcements of expansion ESOPs, leveraged ESOPs and ESOPs adopted by firms with A‐AAA Moody's bond rating. Announcements of nonleveraged ESOPs, expansion ESOPs and B‐BAA rating ESOPs are found to be associated with some resolution of asymmetric information.
Citation
Muhtaseb, M.R. (1997), "Employee Stock Ownership Plans, Common Stock Wealth Effects and Stock Price Variability", Managerial Finance, Vol. 23 No. 3, pp. 39-48. https://doi.org/10.1108/eb018613
Publisher
:MCB UP Ltd
Copyright © 1997, MCB UP Limited