초록 열기/닫기 버튼
In Korea, controlling shareholders in general tend to transfer their shares to their family members or related parties. In this paper, we investigate whether Korean controlling shareholders attempt to influence stock prices by managing the timing of information disclosures when they transfer stocks to related parties as gifts. Because gift taxes are levied based on the average market value of the stock transferred for a certain period known as the valuation period, controlling shareholders may have in-centives to depress the stock prices in this period in order to reduce the gift tax. We make a specific conjecture that controlling shareholders may wish to time the disclo-sure of good news and bad news so that the latter (the former) is released during (outside of) the valuation period for the stock to be transferred. To test this hypothe-sis we examine the disclosure timing of good and bad news for a sample of 118 gift transactions by 83 firms over the period of 2000-2004. We find that during the valua-tion period (i.e., the 4-month period extending over the 2 months before and after the gift transaction) the frequency of good news was considerably lower than in other periods, whereas the frequency of bad news during the valuation period was substantially higher. This result supports the hypothesis that controlling shareholders may delay good news and bring forward bad news in an attempt to influence stock prices during the valuation period. Despite the attempts by controlling shareholders to keep stock prices depressed in the valuation period, we also find that the prices tend to increase after the gift announcement date. We provide some of the potential explanations for the upward price movement subsequent to gift transactions.
