The Relationship between Debt-Equity Swap and Corporate Performance of Workout Firms: An Empirical Evidence from Korean Manufacturing Firm Level Data
0
조회
0
다운로드
0
인용
0
참고문헌
키워드
초록
This research investigates the effectiveness of rescue for financially distressed firms by investigating the validity of workout programs through looking at the cases of Korean manufacturing companies. More specifically, this paper considers debt to equity swap, self-restoration efforts of the firm, and corporate ownership structure as factors which affect performance of workout firms, and performs both short term and long term analyses based on dynamic panel model. This research finds that firms which undergo debt to equity swap experience improved corporate performance after the completion of workout program. In addition, as we consider both creditor banks and debt loaded firms, it is observed that the banks’ decision to swap debt to equity is made contemplating the future growth potential that the company possesses. In other words, we find that if potential for growth is recognized within companies undergoing workout, main creditor banks decide to swap debt to equity. Workout firm adjusting its debt structure through debt to equity swap is found to yield a positive long term corporate performance. Such results imply that the banks’ screening system for growth potential among workout firms functions effectively.
Abstract
This research investigates the effectiveness of rescue for financially distressed firms by investigating the validity of workout programs through looking at the cases of Korean manufacturing companies. More specifically, this paper considers debt to equity swap, self-restoration efforts of the firm, and corporate ownership structure as factors which affect performance of workout firms, and performs both short term and long term analyses based on dynamic panel model. This research finds that firms which undergo debt to equity swap experience improved corporate performance after the completion of workout program. In addition, as we consider both creditor banks and debt loaded firms, it is observed that the banks’ decision to swap debt to equity is made contemplating the future growth potential that the company possesses. In other words, we find that if potential for growth is recognized within companies undergoing workout, main creditor banks decide to swap debt to equity. Workout firm adjusting its debt structure through debt to equity swap is found to yield a positive long term corporate performance. Such results imply that the banks’ screening system for growth potential among workout firms functions effectively.
참고문헌 (14)
- 강동수, "이산선택모형을 이용한 워크아웃기업의 회생요인 분석", 한국개발연구, 26(1), pp.71~104 (2004), 한국개발연구원
- 김석진, "회사재건 제수단의 평가", 재무연구, 13(1), pp.1~25 (2000)
- 박경서, "워크아웃기업의 출자전환에 관한 연구", 재무연구, 15(2), pp.107~141 (2002), 한국재무학회
- 박승일, "워크아웃이 수익성과 현금흐름에 미치는 영향에 관한 연구", 기업경영연구, 18(4), pp.63~80 (2011), 한국기업경영학회
- 이남우, "회사재건 유형별 회사재건 시작시와 종료시의 시장반응", 산업경제연구, 17(5), pp.1939~1960 (2004), 한국산업경제학회
- 이상우, "은행의 대리문제와 부실기업에의 출자전환", 재무관리연구, 24(2), pp.113~145 (2007), 한국재무관리학회
- 장범식, "구조조정기업의 주식성과에 관한 연구", 재무관리연구, 25(1), pp.141~176 (2008), 한국재무관리학회
- Gilson, S., "Troubled Debt Restructuring: An Empirical Study of Private Reorganization of Firms in Default", Journal of Financial Economics, 27, pp.315~353 (1990)
- Holder-Webb, L., "The Performance Consequences of Operational Restructurings", Review of Quantitative Finance and Accounting, 25, pp.319~339 (2005)
- Hotchkiss, E. S., "Post-bankruptcy Performance and Management Turnover", Journal of Finance, 50(1), pp.3~21 (1995)
- James, C., "When Do Banks Take Equity in Debt Restructurings?", Review of Financial Studies, 8(4), pp.1209~1234 (1995)
- Peek, J., "Unnatural Selection: Perverse Incentives and the Misallocation of Credit in Japan", The American Economic Review, 95(4), pp.1144~1166 (2005)
- Schwartz, A., "Bankruptcy Workouts and Debt Contracts", Journal of Law and Economics, 36(1), pp.595~632 (1993)
- Wooldrigdge, Jeffrey M., "Econometric Analysis of Cross Section and Panel Data" (2002), MIT Press