From Empire Building to Strategic Focus: Institutional Influence on Acquisition Discipline and Corporate Value
研究发现机构投资者会约束管理层频繁收购的倾向，支持价值提升的相关收购，且机构持股与企业价值正相关，但频繁收购会削弱这种关系。
ABSTRACT This study investigates the relationship between institutional ownership and the firm's propensity for frequent acquisitions. Acting as monitors, institutional shareholders impose constraints on managerial discretion, reducing the likelihood of frequent acquisitions. Our finding challenges prior assumptions that institutional ownership invariably facilitates acquisitions. Instead, the analysis suggests that institutional investors prioritize acquisition discipline, curbing managerial tendencies toward an empire‐building strategy that may not align with shareholder value maximization. Institutional ownership, however, has a positive influence on related acquisitions. Banks and insurance companies, namely relational investors, positively influence the acquisition frequency, indicating some support for the career concerns hypothesis. Public pension funds and mutual funds are likely to restrain firms from undertaking frequent acquisitions. We find a positive relation between institutional ownership and firm value, which weakens with an increase in the acquisition frequency but becomes stronger with an increase in the frequency of related acquisitions. Most institutional investors support value‐enhancing acquisitions but oppose the company's propensity to make acquisitions frequently.