Endogenous ownership structure:factors affecting the post-privatisation equity in largest Hungarian firms

Using a data set for the 162 largest Hungarian firms during the period of 1994-1999, this paper explores the determinants of equity shares held by both foreign investors and Hungarian corporations. Evidence is found for a post-privatisation evolution towards more homogeneous equity structures, where dominant categories of Hungarian and foreign owners aim at achieving controlling stakes. In addition, focusing on firm-level characteristics we find that exporting firms attract foreign owners who acquire controlling equity stakes. Similarly, firm-size measurements are positively associated with the presence of foreign investors. However, they are negatively associated with 100% foreign ownership, possibly because the marginal costs of acquiring additional equity are growing with the size of the assets. The results are interpreted within the framework of the existing theory. In particular, following Demsetz and Lehn (1985) and Demsetz and Villalonga (2001) we argue that equity should not be treated as an exogenous variable. As for specific determinants of equity levels, we focus on informational asymmetries and (unobserved) ownership-specific characteristics of foreign investors and Hungarian investors

Centralization, renationalization, redistribution, the role of the government in changing the ownership structure in Hungary, 1989-93

SIGLEAvailable from British Library Document Supply Centre- DSC:3597.9512(CEPR-DP--916) / BLDSC - British Library Document Supply CentreGBUnited Kingdo

Non-standard methods in the privatization strategies of the Czech Republic, Hungary and Poland 1

The Czech Republic, Hungary and Poland followed different strategies in the use of non-standard methods of privatization. In regard to restitution , the Czech Republic carried out physical return of property, Hungary weakly implemented financial compensation and Poland has not yet approved a programme. Management and employee buyouts were eschewed in the Czech Republic, took the form of employee stock ownership plans in Hungary and were accomplished chiefly by lease-purchase in Poland. The Czech mass privatization programme distributed a considerable amount of joint-stock company shares free through voucher auctions in which citizens participated directly or through financial intermediaries. In contrast, the Polish programme provided citizens free shares in investment trusts that exercise corporate governance over operating companies and restrure them for divestiture. Hungary's programme, which offered people only interest-free loans to buy some shares in intial public offerings, was abandoned soon after its start.Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/71946/1/j.1468-0351.1997.tb00020.x.pd