The impact of ownership structure on cash holdings in the Egyptian-listed companies
摘要
This study aims to examine the impact of ownership structure including family ownership and foreign ownership on cash holdings in Egyptian-listed companies’ annual reports.
Research MethodologyThe study uses data from a sample of 46 listed companies on the Egyptian Stock Exchange extracted from (EGX 70) for 8 years period from 2014 to 2021. The study uses panel linear regression model to test its hypotheses.
Results and findingsThe findings revealed that family and foreign ownerships have significant positive impact on cash holdings. In other words, companies with family and foreign ownerships’ structure tend to hold more cash as they have the propensity to maintain higher levels of cash holdings than companies with other types of structures.
Empirical implicationsThe results highlight the importance of family and foreign ownership structures as determinants for the companies’ cash holdings which supports decision-making process.
Originality/valuePrior studies have primarily focused on developed markets; however, research on the emerging markets such as Egyptian market is scarce, particularly regarding the controversial results concerning the nature of the relationship between family and foreign ownership with cash holdings. Therefore, this study contributes to existing literature by attempting to answer the ongoing debate regarding the impact of ownership structure on cash holdings in the Egyptian context.