Premium
Dividend Policies of Privately Held Companies: Stand‐Alone and Group Companies in Belgium
Author(s) -
Rommens An,
Cuyvers Ludo,
Deloof Marc
Publication year - 2012
Publication title -
european financial management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.311
H-Index - 64
eISSN - 1468-036X
pISSN - 1354-7798
DOI - 10.1111/j.1468-036x.2010.00554.x
Subject(s) - dividend , dividend policy , business , shareholder , dividend tax , corporate group , dividend payout ratio , payment , monetary economics , economics , finance , financial system , corporate governance , market economy , tax reform , gross income , state income tax
This study examines the dividend policies of privately held Belgian companies, differentiating between stand‐alone companies and those affiliated with a business group. We find that privately held companies typically do not pay dividends. Compared to public companies, they are less likely to pay dividends and they have lower dividend payouts. Our results also suggest that group companies pay more dividends than stand‐alone companies, consistent with the hypothesis that tax‐exempt group firms redistribute dividend payments on the group's internal capital market. Group companies pay higher dividends if they have minority shareholders.