Abstract

Few researchers focus on how share class structures affect corporate decisions, particularly asset transactions. With a hand-collected sample of 1632 asset transactions by TSX- and TSX-V-listed purchasers, we first test whether the relative transaction values differ for single- and dual-class buyers, and then examine how the degree of dual class structures influences the relative transaction values with a subsample of 82 transactions involving only dual-class buyers. We also explore whether the relative value of asset purchases depends on three characteristics of dual-class purchasers. Our empirical evidence shows that the relative transaction value for a dual-class purchaser is significantly larger only when a subsample of family-controlled buyers is used, and that a higher degree of dual class structure corresponds to a larger relative transaction value. We find that the relative transaction values for family-controlled, dual-class purchasers are greater than those for nonfamily-controlled ones, that a higher family ownership leads to a bigger relative transaction value, and that the relative value for dual-class buyers who have more than one family member on the board is smaller.