Tufano, Peter, Khorana, Ajay and Wedge, Lei (2007) Board structure, mergers, and shareholder wealth: a study of the mutual fund industry. Harvard Business School Working Paper.Full text not available from this repository.
We study mutual fund mergers between 1999 and 2001 to understand the role and effectiveness of fund boards. Some fund mergers—typically across-family mergers—benefit target shareholders but are costly to target fund directors. Such mergers are more likely when funds underperform and their boards have a larger percentage of independent trustees, suggesting that more-independent boards tolerate less underperformance before initiating across-family mergers. This effect is most pronounced when all of the fund's directors are independent, not the 75% level of independence required by the SEC. Higher-paid target fund boards are less likely to approve across-family mergers that cause substantial reductions in their compensation.
|Item Type:||Other Working Paper|
|Keywords:||Mutual funds; Mergers; Governance|
|Date Deposited:||28 Oct 2011 09:25|
|Last Modified:||15 Oct 2015 02:18|
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