Papers by Pascal Dumontier
In an attempt to mitigate the conflicts of interest stemming from the interdependence of equity r... more In an attempt to mitigate the conflicts of interest stemming from the interdependence of equity research and investment banking departments of brokerage houses, the European Commission has enacted the Market Abuse Directive (MAD) in 2003. We document that this reform was by and large inadequate and may have triggered counterproductive consequences. In particular, we first demonstrate that conflicts of interest
SSRN Electronic Journal, 2002
ABSTRACT We examine the wealth effects of 101 tender offers, completed by French companies betwee... more ABSTRACT We examine the wealth effects of 101 tender offers, completed by French companies between January 1980 and December 2000 and we distinguish two categories of tender offers: Control-oriented ones, i.e. offers involving a change in control, and parent-subsidiary ones, i.e. offers where the acquirer holds more than 50 percent of the target's outstanding shares before the bid. We obtain the following results. First, we show that tender offers are much more profitable for target shareholders. Second, we observe that, on average, bidder returns are positive and significant for control-oriented offers, whereas they are negative and significant for parent-subsidiary ones. Third, results suggest that control-oriented acquisitions tend to create value, whereas parent-subsidiary ones tend to destroy value. Since we show that bidders exhibit low or negative returns at the announcement of the offer, we examine the determinants of these low or negative returns. The determinants under study are related to the characteristics of the offers, as well as to some characteristics of the acquirers. We observe that returns of French acquirers are affected by the quality of their management, by the relatedness of their activities with those of the targets and by the level of competition to acquire the target. Specifically, bidder returns are higher for companies that are indebted, with a high market-to-book ratio (i.e. 'glamour' firms), whose activities are similar to the targets' ones, and that do not face competition during the tender offer. However, returns of French acquirers do not appear to be related to the method of payment, nor to the bidders' shareholdings in their target prior to the bid.
Revue française de gestion, 2015
Les études des effets de l'adoption obligatoires des IFRS sont nombreuses. Elles ne montrent pas ... more Les études des effets de l'adoption obligatoires des IFRS sont nombreuses. Elles ne montrent pas toutes une amélioration significative de la qualité de l'information comptable. En revanche, elles s'accordent à reconnaître les bienfaits de cette adoption pour les investisseurs (meilleure liquidité des titres et réduction de l'asymétrie informationnelle) et pour les entreprises (réduction du coût de leur capital). Les effets mis en évidence par ces études ne sont toutefois que des effets moyens, aucune étude n'ayant considéré les caractéristiques de l'entreprise. L'étude que nous proposons vise à combler cette lacune. Elle montre que toutes les entreprises n'ont pas identiquement bénéficié de l'adoption des IFRS. Se focalisant sur l'asymétrie d'information qui caractérise l'entreprise, variable clé puisque les IFRS visent à accroître la transparence des firmes et par conséquent réduire leur déficit informationnel, l'étude montre que les entreprises qui ont bénéficié des IFRS sont celles qui divulguent le plus sur une base volontaire et celles qui sont le plus activement suivies par les analystes financiers. Les firmes peu suivies et celles qui divulguent peu ont été pénalisées par l'adoption des nouvelles normes. Les entreprises présentant les actifs et les activités les plus complexes, et donc les plus difficiles à décrire au moyen de l'information comptable, ont également tiré avantage de l'adoption des IFRS. Enfin, les entreprises qui souffraient du plus fort déficit informationnel ont vu ce déficit s'accroître suite à cette adoption. En revanche, et paradoxalement, les entreprises qui avaient le moins à gagner de l'adoption des IFRS du fait d'un faible déficit informationnel ont vu ce déficit se réduire un peu plus.
We investigate the effects of mandatory IRS adoption in th EU on accounting conversation, an esse... more We investigate the effects of mandatory IRS adoption in th EU on accounting conversation, an essential feature of earning quality, and the way large audit firms(big 4) interact with it.
SSRN Electronic Journal, 2000
ABSTRACT We examine the wealth effects of 101 tender offers, completed by French companies betwee... more ABSTRACT We examine the wealth effects of 101 tender offers, completed by French companies between January 1980 and December 2000 and we distinguish two categories of tender offers: Control-oriented ones, i.e. offers involving a change in control, and parent-subsidiary ones, i.e. offers where the acquirer holds more than 50 percent of the target's outstanding shares before the bid. We obtain the following results. First, we show that tender offers are much more profitable for target shareholders. Second, we observe that, on average, bidder returns are positive and significant for control-oriented offers, whereas they are negative and significant for parent-subsidiary ones. Third, results suggest that control-oriented acquisitions tend to create value, whereas parent-subsidiary ones tend to destroy value. Since we show that bidders exhibit low or negative returns at the announcement of the offer, we examine the determinants of these low or negative returns. The determinants under study are related to the characteristics of the offers, as well as to some characteristics of the acquirers. We observe that returns of French acquirers are affected by the quality of their management, by the relatedness of their activities with those of the targets and by the level of competition to acquire the target. Specifically, bidder returns are higher for companies that are indebted, with a high market-to-book ratio (i.e. 'glamour' firms), whose activities are similar to the targets' ones, and that do not face competition during the tender offer. However, returns of French acquirers do not appear to be related to the method of payment, nor to the bidders' shareholdings in their target prior to the bid.
SSRN Electronic Journal, 2000
SSRN Electronic Journal, 2000
In 1980, the newly elected French government initiated an unprecedented move by undertaking a mas... more In 1980, the newly elected French government initiated an unprecedented move by undertaking a massive nationalization plan. This plan took effect in 1982 and concerned 50 firms which, at the time, played a crucial role in the French economy. The French government move was however destined to be short lived as a shift occurred in 1986. The French government then initiated a privatization program, and ended up privatizing some of the firms that were nationalized in 1982. In this paper we investigate the extent to which the French population registered a gain or ended up paying a premium as a consequence of the government strategy. Also, we measure the value that was created or lost during the nationalization period for each of the firm included in the sample. Our results show that the French government managed to create value during the nationalization process, and that the nationalized firms benefited from the rationalization effort on the part of the French government, as dramatic post-privatization performance increases tend to demonstrate. Our results also show that although value was created, the French government, and thereby the French citizens, ended up paying a fairly large premium to the private owners of the nationalized firms.
Revue d'économie industrielle, 1987
In: Revue d'économie industrielle. Vol. 42. 4e trimestre 1987. pp. 62-73. Abstract
Comptabilité - Contrôle - Audit, 1999
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Papers by Pascal Dumontier