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Extant literature has usually argued that firms that unify dual class shares are likely to increase shareholder value. We examine the universe of Italian dual class unifications over the 1974-2005 period and show that the unification process is considerably more complex than described in prior literature. In over half the universe, Italian voting shareholders are not compensated for allowing their voting rights to be diluted, and, not surprisingly, experience a price decline at the announcement of unifications. While non-voting shares appreciate in value at the announcement there is little evidence that the unification increases total firm value. We argue that share unifications are designed to benefit the controlling shareholders and, in several cases, controlling voting shareholders use the unification to expropriate wealth from minority shareholders.

Italian corporate governance is characterized by advanced regulations (equalling or exceeding the continental European average) but a low degree of enforcement. The ownership structure of listed companies is highly concentrated, and public companies with dispersed ownership are rare. Most of the time, a majority shareholder (a family, a company or the government) controls a relevant stake of voting rights and exercises full control of the company. Legal devices such as pyramidal groups, non-voting shares and voting agreements are relatively widespread and allow separation of ownership from control, especially in family groups. It follows that the typical agency conflict is not between managers and shareholders, as in the United States or the United Kingdom, but between majority and minority shareholders.

An increasing number of firms with dual class shares are deciding to unify their shares around the world. Though the return to “one share one vote” is usually considered good news, the unification can give rise to a wealth transfer between the two classes of shares, especially in the presence of high voting premia and no form of compensation to voting shareholders. These conditions characterize most of Italian dual class unification (DCUs) made in the 1982-2005 period. Italian DCUs, differently from any other country, gave rise to a significantly negative reaction of the voting shares and no significant variation in the firm’s overall value. The actual reactions on the two classes of shares also appear well aligned with what expected from a wealth-transfer framework developed in the paper. Changes in firm’s value are positively correlated with larger ownership of the largest and second largest shareholders, while negative correlated with high voting premia and large fractions of nonvoting equity Unification as a new form of (minority voting) shareholders’ expropriation is further confirmed by five case studies where the majority shareholder buys relevant blocks of nv-shares, sells voting shares or approves stock option plans on nv-shares just some months before the unification announcement.

An increasing number of firms with dual class shares are deciding to unify their shares around the world. Though the return to one share-one vote system is usually considered good news for voting shareholders, the unification can give rise to a wealth transfer between the two classes of shares, especially in the presence of high voting premia and no form of compensation to voting shareholders. These conditions characterize most of Italian dual class unification (DCUs) made in the 1982-2005 period. Different from any other country, in Italian DCUs, voting shares earn significantly negative returns Changes in firm’s value are positively correlated with larger ownership of the largest and second largest shareholders, and negatively correlated with high voting premia and large fractions of non-voting equity. We also provide more detailed evidence on five cases where the majority shareholder buys relevant blocks of non-voting shares, sells voting shares or approves stock option plans on non-voting shares a few months before the unification announcement.

An increasing number of firms with dual class shares are deciding to unify their shares around the world. Though the return to “one share one vote” is usually considered good news, the unification can give rise to a wealth transfer between the two classes of shares, expecially in the presence of high voting premia. This paper develops a model that quantifies the wealth effects on the two classes of shares depending on the type of unification, the voting premium and the equity structure. The model shows that voting shareholders can be substantially harmed by a 1:1 unification in the presence of high voting premia. The model predictions are then tested and validated on Italian unifications, characterized by the presence of a majority shareholder, high value of voting rights and no form of compensation for voting shareholders. Unifications can be a form of expropriation of minority voting shareholders, as confirmed by five case studies where majority shareholders hedge or even take advantage of such operations by engaging in the following activities some months before the unification decision: buying relevant blocks of nv-shares, selling voting shares or approving stock option plans on nv-shares. At the stock unification announcement the price of a voting share in the five case studies dropped by a minimum of –4.26%, to a maximum of –10.41%, consistent with the assertion that dual class unifications expropriate minority-voting shareholders to the benefit of the controlling shareholders.

This paper tries to offer a review of the literature on the main privatisation methods adopted by the Central and East European Countries which have joined European Union in 2004. After having analysed the major advantages and shortcomes of each privatisation method the paper briefly describes the privatisation processes adopted by each single country.

An increasing number of firms with dual class shares are deciding to unify their sharesaround the world. In the most common type of stock unification a non-voting share can be converted into a voting share. In most countries either the price differential between the two classes of shares is low or a form of compensation for voting shareholders is provided. Italian stock unifications see the highest value of voting rights and no form of compensation for voting shareholders. I observe the 43 Italian stock unifications made in the 1974-2003 period and I develop a model that quantifies their wealth effects on the two classes of shares. Stock unifications can be a form of expropriation of minority voting shareholders, as confirmed by five case studies where majority shareholders hedge or even take advantage of such unifications by engaging in the following activities some months before the unification decision: buying relevant blocks of nv-shares, selling voting shares or approving stock option plans on nv-shares. At the stock unification announcement the price of a voting share in the five case studies dropped by a minimum of –4.26%, to a maximum of –10.41% confirming that dual class unifications can expropriate minority-voting shareholders to the benefit of the controlling shareholder and “lucky” minority nv-shareholders.

After reviewing the main valuation frameworks of asset management firms, we ran empirical research on 50 listed US and European asset management firms in the 2008-2017 period. Our results find that such firms are characterized by a high EBIT and earnings margin, respectively equal, on average, to 28% and 17% of revenues, represented by fees. The average yearly fees are equal to 1.04% of assets under management (AUM) and the average firm value is equal to 3.01%, confirming the values at which these companies are typically acquired on the market. Higher values are found to be significantly positively correlated with a higher earnings margin and a higher level of fees on AUM, confirming the previous findings of Joenväärä and Scherer (2017) on a smaller US sample.

The papers included in this special issue have been selected from those presented at the track in ‘‘banking and finance’’ of the conference organized in Lecce on the 19 and 20 September 2013 to celebrate the bicentenary of the Italian Academy of Management (Accademia Italiana di Economia Aziendale, AIDEA). AIDEA is one of the oldest academic societies worldwide, having been founded in Bologna (Italy) on the 11 July 1813 as the Accademia dei Logismofili. The track in ‘‘banking and finance’’ of the conference was organized in collaboration with the Financial Network of European Studies (FINEST), a research and discussion forum for financial intermediation researchers and practitioners throughout Europe. FINEST operates as an open research network facilitating research and other related activities among the faculty in various European Universities as well as policymakers and financial sector practitioners. The ‘‘banking and finance’’ track of the conference attracted 220 paper submissions and, after a rigorous selection process by the members of the Scientific Committee, 108 papers were accepted for presentation. Of the papers presented, 50 papers were submitted for the special issue and went through the normal journal review process. Among them, 9 survived the JBF selection process and have been accepted for publication. These papers cover a wide range of contemporary financial research issues, mostly in banking, and we group them in three areas: (1) banking regulation and supervision; (2) bank performance, and (3) monetary policy and asset pricing