Title: Demutualisation, initial public offerings and long-run market performance of Canadian life insurance companies
Authors: Sebouh Aintablian
Addresses: Department of Finance and Accounting, School of Business, Lebanese American University, P.O. Box: 13-5053 Beirut, Lebanon
Abstract: We examine alternative hypotheses for the demutualisation of a sample of Canadian life insurance companies (1999-2000) as well as short-run and long-run market effects of demutualisation on firm performance. Our results indicate that the Canadian insurance companies became more efficient after converting to publicly traded stock companies and that wealth expropriation was not the primary motive behind demutualisation. We also find that the stocks of the demutualised companies out-performed the market during the three year period after going public.
Keywords: demutualisation; initial public offerings; IPOs; life insurance companies; Canada; long-run market performance; firm performance; efficiency; wealth expropriation.
International Journal of Financial Services Management, 2013 Vol.6 No.3, pp.200 - 218
Received: 22 Aug 2012
Accepted: 12 Aug 2013
Published online: 27 Nov 2013 *