Prior studies conceptualize institutional monitoring by the terms “concentration of institutional investors” and “heterogeneity in institutional investors”. This paper focuses on the frequency of institutional investors’ corporate site visits (CSV) in relation to firms’ performance. In the context of acquisition, I hypothesize that bidding firms with more institutional investors’ CSV will have higher abnormal announcement-period return. However, the results indicate that more institutional investors’ CSV cannot predict better acquisition decisions, unless they meet firms’ CEO or high-level managements during site visits. The reason could be that internal communication in companies is not efficient due to the hierarchy of the organization. These findings survive a number of robustness tests, including tests after winsorizing data, alternative measures for corporate site visit, and alternative samples. Moreover, further analysis shows that institutional investor’ CSV and institutional ownership are complements of each other in terms of enhancing corporate governance
