...Sina Amiri; David King; Samuel DeMarie Purpose There are multiple perspectives of divestiture and its performance that require reconciliation. While research finds a positive market response to divestment announcement, divestiture of prior acquisitions are generally viewed negatively. The purpose...

... or the subsidiary's debt (Allen and McConnell, 1998 ; Lang et al., 1995). Further, it is argued that the parent firm benefits from the fact that through a divestiture separate financing for the divested unit's investment projects is obtained (Schipper and Smith, 1983). The managerial incentive...