Title: A decision making framework to evaluate the necessity of corporate restructuring

Authors: Imaneddin Moradi Baghfeizi; Hossein Rahmanseresht; Saeed Fathi

Addresses: Faculty of Administrative Science and Economics, University of Isfahan, Iran ' Faculty of Management and Accounting, Allame Taba Tabaee University, Iran ' Faculty of Administrative Science and Economics, University of Isfahan, Iran

Abstract: This paper aims at presenting a 3 × 3 matrix to determine the structure of a holding company based on the degree of diversification and parenting style. Non-conformity of structure with this framework means that a restructuring is necessary. Three hypotheses have been tested to evaluate the validity of this framework. The first two hypotheses respectively assess the association between the 'degree of diversification' and 'parenting style' with 'structural form' based on chi-square test. But to test the third hypothesis, the holding companies compliance with the framework is divided into two groups and Mann-Witni (U) test shows that there is a significant difference between their performances. Based on Sharp's index, the economic performance of the holdings which are consistent with the framework, over a period of five years, is about 11 times better than non-conformers with the framework.

Keywords: holding company; corporate restructuring; structural form; degree of diversification; parenting style; economic performance; parenting advantage.

DOI: 10.1504/IJBEX.2018.092571

International Journal of Business Excellence, 2018 Vol.15 No.3, pp.269 - 288

Received: 06 Aug 2016
Accepted: 21 Jan 2017
Published online: 25 Jun 2018 *

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