How are U.S. Family Firms Controlled?

In large U.S. corporations, founding families are the only blockholders whose control rights on average exceed their cash-flow rights. We analyze how they achieve this wedge, and at what cost. Indirect ownership through trusts, foundations, limited partnerships, and other corporations is prevalent but rarely creates a wedge (a pyramid). The primary sources of the wedge are dual-class stock, disproportionate board representation, and voting agreements. Each control-enhancing mechanism has a different impact on value. Our findings suggest that the potential agency conflict between large shareholders and public shareholders in the United States is as relevant as elsewhere in the world

Corporate Divestitures and Family Control

This paper investigates the relationship between divestitures and firm value in family firms. Using hand-collected data on a sample of over 30,000 firm-year observations, we find that family firms are less likely than non-family firms to undertake divestitures, especially when these companies are managed by family rather than non-family-CEOs. However, we then establish that the divestitures undertaken by family firms, predominantly those run by family-CEOs, are associated with higher post-divestiture performance than their non-family counterparts. These findings indicate that family firms may fail to fully exploit available economic opportunities, potentially because they pursue multiple objectives beyond the maximization of shareholder value. These results also elucidate how the characteristics of corporate owners and managers can influence the value that firms derive from their corporate strategies

Do Analysts Add Value When They Most Can? Evidence From Corporate Spin-Offs

This article investigates how securities analysts help investors understand the value of diversification. By studying the research that analysts produce about companies that have announced corporate spin-offs, we gain unique insights into how analysts portray diversified firms to the investment community. We find that while analysts\u27 research about these companies is associated with improved forecast accuracy, the value of their research about the spun-off subsidiaries is more limited. For both diversified firms and their spun-off subsidiaries, analysts\u27 research is more valuable when information asymmetry between the management of these entities and investors is higher. These findings contribute to the corporate strategy literature by shedding light on the roots of the diversification discount and by showing how analysts\u27 research enables investors to overcome asymmetric information

FGFR1 Cooperates with EGFR in Lung Cancer Oncogenesis, and Their Combined Inhibition Shows Improved Efficacy

Introduction: There is substantial evidence for the onco- genic effects of fi broblast growth factor receptor 1 (FGFR1) in many types of cancer, including lung cancer, but the role of this receptor has not been addressed speci fi cally in lung adenocarcinoma. Methods: We performed FGFR1 and EGFR overexpression and co-overexpression assays in adenocarcinoma and in inmortalized lung cell lines, and we also carried out surrogateandinteractionassays.Weperformedmono- therapy and combination EGFR /FGFR inhibitor sensitivity assays in vitro and in vivo in cell line – and patient- derived xenografts. We determined FGFR1 mRNA expression in a cohort of patients with anti – EGFR ther- apy – treated adenocarcinoma. Results: We have reported a cooperative interaction between FGFR1 and EGFR in this context, resulting in increased EGFR activation and oncogenic signaling. We have provided in vitro and in vivo evidence indicating that FGFR1 expression in- creases tumorigenicity in cells with high EGFR activation in EGFR-mutated and EGFR wild-type models. At the clinical level, we have shown that high FGFR1 expression levels pre- dict higher resistance to erlotinib or ge fi tinib in a cohort of patients with tyrosine kinase inhibitor – treated EGFR-mutated and EGFR wild-type lung adenocarcinoma. Dual EGFR and FGFR inhibition in FGFR1-over expressing, EGFR-activated models shows synergistic effects on tumor growth in vitro and in cell line – and patient-derived xenografts, suggesting that patients with tumors bearing these characteristics may bene fi t from combined EGFR/FGFR inhibition. Conclusion: These results support the extended the use of EGFR inhibitors beyond monotherapy in the EGFR-mutated adenocarcinoma setting in combination with FGFR in- hibitors for selected patients with increased FGFR1 over- expression and EGFR activation.ISCIII PI14/01964 PIE15/00076 PI17/00778 DTS17/00089 PI15/00045 PI17/00033 PI16/01311 FI12/00429CIBERONC CD16/12/00442FEDER CD16/12/00442 PI16/01311Spanish Ministry of Economy and Competitiveness PI15/00045Ministry of Health and Social Welfare of Junta de Andalucía PI-0046-2012 C-0040-2016Ministry of Equality, Health and Social Policies of the Junta de Andalucía PI- 0029-2013Comunidad de Madrid B2017/BMD3884Ministry of Education, Culture and Sports FPU13/0259

Family Control of Firms and Industries

We test what explains family control of firms and industries and find that the explanation is largely contingent on the identity of families and individual blockholders. Founders and their families are more likely to retain control when doing so gives the firm a competitive advantage, thereby benefiting all shareholders. In contrast, nonfounding families and individual blockholders are more likely to retain control when they can appropriate private benefits of control. Families are more likely to maintain control when the efficient scale is small, the need to monitor employees is high, investment horizons are long, and the firm has dual-class stock. Family-controlled firms dominate the corporate landscape around the world (La Porta, López de Silanes, and Shleifer, 1999; Claessens, Djankov, and Lang, 2000; Faccio and Lang, 2002). In fact, entire industries are dominated by family firms. The global beer industry is one example of this phenomenon. InBev, Anheuser-Busch, SABMiller, Heineken, FEMSA, Carlsberg, and many smaller companies are still controlled by their founding families or related foundations. In the United States, six of the seven largest cable system operators, including Comcast, Cox, Cablevision, and Charter Communications, are controlled and actively managed by their founders or the founder’s heirs (Gilson and Villalonga, 2007). Eleven of the 12 largest publicly trade