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This paper aims to conduct an empirical analysis of subnational laws of the USA that require public pension funds to divest from companies that are in business with Cuba, Iran, Syria, and Sudan and explores whether public fund officials may be in violation of their fiduciary duty responsibilities toward pension system beneficiaries as they execute state-mandated divestment schemes.

A database search was conducted for specific federal laws, presidential executive orders, and departments, offices, and terminology relevant to the topic of the research to explore the extent by which states employ public pension divestment regimes inspired by the federal governments designation of the four countries labeled as state sponsors of terrorism. Quantitative and financial calculations were used to conduct the cost analysis of divestment laws.

Divestment laws are costly for the beneficiaries. In the majority of the states that have divestment laws, the public funds, rather than the states, must cover the losses associated with divestment, resulting in pension fund trustees and managers having to take action that are in violation of their fiduciary duty responsibilities.

The study recommends a major overhaul of the current divestment laws.

Divestment legislations must be revised as they cause a divergence of interests between state-driven political gestures, the fiduciary responsibilities of pension system trustees, and the financial interests of the beneficiaries.

This is the first study that recommends specific legislative action that would resolve the divergence of interests between state-driven political gestures, the fiduciary responsibilities of pension system trustees, and the financial interests of the beneficiaries.

Purpose – Investigate the causes and consequences of foreign financial institutions' divestments in China's banking sector which is an example of cross-border transactions by institutional investors.

Methodology – Use a sample of 26 foreign financial institutions' strategic investments in Chinese banks. Ten of those investments are divested after the global financial crisis. We investigate determinants of the divestment, business cooperation after the divestment, and Chinese banks' stock price reactions to the divestment announcement.

Findings – The poor performance of foreign financial institutions, which is attributable to the global financial crisis, and the institutions' regulated low equity ownership are important causes of divestment (or whole divestment). In contrast, Chinese banks' poor performance does not cause foreign divestments. Foreign financial institutions that fully divest their equity stakes usually terminate their cooperative business, which was required by the strategic investment agreement. The Bank of China and the China Construction Bank, which experienced large H-share divestments, experienced large economic declines in A-share values.

Social implications – Foreign financial institutions' strategic investments created substantial shareholder value before the divestment. Banking sector developments that rely on foreign investments are vulnerable to economic downturns in developed countries.

Originality/value of paper – To the best of our knowledge, this is the first trial to analyze the impact of divestments on divested bank performance.

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 of this paper is to develop and empirically test different explanations for the divestment of prior acquisitions.

This research employs event study to capture market reaction at acquisition announcement and subsequent divestments in a sample of 69 public US high-technology acquisitions between 2003 and 2008 that were divested by 2015. Only initial acquisitions involving public firms were included from the Thomson One Banker SDC database. Public press releases and companies’ SEC filings were reviewed to track divestitures back to prior acquisitions. Ordinary least squared regression was used to estimate coefficients.

Results indicate a positive relation between acquisition and divestiture performance around announcement dates. This finding rejects the correction of mistake explanation, suggesting that a negative stigma surrounding divestments is largely unwarranted and that investors reward capable acquirer’s divestiture decisions.

Investors do not treat all information signals at divestiture equally. For example, acquisitions made by larger and more profitable firms, or acquisitions paid for with stock, are associated with lower return upon divestiture announcement.

This study finds that investors view divestiture as a proactive strategy, suggesting firms can improve performance by actively managing acquisitions and divestments to optimize their portfolio of businesses.

The purpose of this paper is to provide a robust examination of the factors that accelerate/decelerate the divestment timing of retail banners in international markets.

The sample represents 3,235 foreign market banner operations of 132 international retailers across 144 countries using an accelerated failure time (AFT) parametric survival modelling technique.

Banner divestment is accelerated by both weak financial performance and smaller size. Furthermore, there is a synergistic negative detriment to the combination of both factors on divestment. Banner divestment is decelerated by deploying the corporation’s dominant format in the home country. Moreover, inadequately performing dominant banners are allowed more time to turn around their operations than subpar non-dominant banners. Concurrently, when host country markets are growing, poorly performing dominant banners are given more time to improve performance. When home market performance weakens, smaller, poorly performing banner divestment is accelerated.

The large data set covers more than half of the world so the authors are limited to observing corporate divestments without the benefit of the managerial decision-making process. The authors only have access to divestment data in annual units, which limits the ability to provide precise timing information. Though the authors have a wide variation in country conditions, data on smaller, poorer countries and domestic competitors is limited.

Small, poorly performing retail chains in foreign markets are divested faster than their counterparts. When retailers internationalize with their dominant chains, management tends to give these banners more time to succeed than non-dominant counterparts. Evidence also suggests that managers hesitate to withdrawal from a foreign market when the dominant banner is involved, regardless of a chain’s stunted growth and subpar performance.

This study provides the first examination of factors driving the divestment times of international retail chains using rigorous empirical survival time methodologies.

The purpose of this paper is to review the existing research on industrial divestment in order to identify the reasons for it, the process whereby it is achieved, and the outcomes of industrial sell-offs and closures. The study reports the main findings that have gained acceptance in the literature, gaps in the research and potential directions for future research.

A three stage systematic literature review protocol was used to conduct this review. The results are organized according to an “Antecedents – Process – Outcomes” framework.

The traditional accounts of industrial divestment have been framed in terms of firms’ weak performance and over-diversification as antecedents to divestment, leading to corporate governance issues. However, the list of antecedents of industrial divestment is more extensive. There is no consensus over the impact of some factors on divestments, as is the case of firm and unit size. The results are not conclusive as to whether firm performance improves after divesting.

Future research should analyze the relationship between the antecedents of investment and divestment. The divestment process is not well studied and more studies that engage in theory building are needed, namely, on primary data and examining the short-term and long-term impacts of divestment on performance.

This review offers a comprehensive synthesis of the antecedents, the process and outcomes of divestment through sell-offs and closures. Factors such as environmental conditions and the entry mode strategy are important in determining the divestment of subsidiaries. Divestments may be positively or negatively regarded by shareholders, depending on the context of the firm. Promoting managerial changes facilitates divestment.

This paper synthesizes knowledge of the main reasons as to why firms completely dispose of their assets, contributing to this under-researched field.

The divestment of international retail operations is an under‐explored area of research. Conceptual and theoretical developments within retailing have tended to focus on those organisations that have sustained international development rather than on those organisations who have experienced market failure and strategic withdrawals from international markets. The paper discusses two prominent UK cases where market withdrawal has been a feature of international activity. A cross‐case analysis is then used to identify issues for further research activity. In particular, the cross‐case analysis uses the existing constructs that have emerged from the general literature to explain divestment activity while highlighting the limitations of using these constructs within the retail sector. The paper concludes by noting the limitations of existing frameworks that seek to explain the internationalisation process without due consideration of the divestment process.

The research presented here initiates the process of the detailed analysis of international retail divestment activity through the identification of the volume of global divestment activity and the characteristics of that activity during the timeframe of 1987‐2003.

The methodology followed here is essentially historical in nature and draws on a wide range of contemporary periodicals, reports and other sources.

The paper reports findings on: the form and extent of divestment activity; the year of divestment; divestment by retail sub‐sector; divested chain size; length of time spent in the market of divestment; divestment by retail sub‐sector; and the market of origin of divesting retailer.

This paper provides an initial indication of the volume and nature of international retail divestment in the period considered. Such material has not been available previously. International retailing research has primarily focused on the internationalisation process rather than retail divestment from international markets. However, divestment from international markets is an issue of increasing importance within the competitive global environment. Previously research into retail divestment has focused on individual company experience. For the first time, the research presented here attempts to build a picture of the scale and dimensions of international retail withdrawal. The paper shows that patterns of international divestment are discernible.

Development Banks (DBs) are specialized financial institutions created for the purpose of balanced industrialization. A development bank has to act more as a promotional agency than a mere financial institution. Therefore separate institutions have been set up, namely State Industrial Development Corporations (SIDCs) in almost all the states in India for undertaking promotional activities. With the growing role of Development Banking in India, the SIDCs are facing financial hardships as they are wholly dependent on Government grants. The paucity of funds for SIDCs has prompted them to opt for divestment of their shareholdings from the existing units to recycle the funds for increasing industrial promotion. Divestment decisions are concerned with the quantum and timing of divestment and the determination of share prices for this purpose. SIDCs are different in that their divestment decisions need not be primarily guided by economic factors (capital appreciation). Highlights the divestment policy and share evaluation models adopted by a development bank, namely Andhra Pradesh Industrial Development Corporation Ltd, which is basically responsible for transforming an agrarian Indian state (Andhra Pradesh), into a moderate industrial organization.

This paper aims to explore the nature of divestment within the context of retailer internationalisation.

It focuses on the activities of the Dutch food multinational retailer Royal Ahold (Ahold). Drawing on 37 in‐depth interviews with investment banks and executives, this paper provides a number of insights into Ahold's international retail divestment activities within the context of a broadly successful international investment strategy.

It offers some new insights into the multidimensional nature of international retail divestment construct in terms of the operational as well as more subtle and less visible non‐operational international retail divestments. It is concluded from this study that, rather than portraying strategic and opportunistic approaches as binary opposites, a retail firm may have varying degrees of approaches to international retail divestment, and these may not necessarily be isomorphic across different countries.

The paper explores international retail divestment from a rather broad perspective, although it is hoped that these parameters can be used to raise a new set of more detailed priorities for future research on international retail divestment.

This paper raises a number of interesting issues such as whether retailers initially take divestment seriously and the degree to which this is actually possible during market entry.

As called for in the literature, this study examines divestment in the broadest possible fashion, thus addressing a major gap in our understanding of the whole internationalisation process.

Brings together the different strands of the divestment literature – industrial organization, finance, and corporate strategy – which have been developing over the last 20 years. Points to be increased resort to divestment by corporate managers and suggests that this adaptive activity should now be accepted as a normal phase of company development. However, such acceptance is made difficult by factors which fall within the domain of managerial psychology. Provides an overview which should be useful to practitioners confronting divestment decisions and to academics embarking on new research in the area.