Capital Structure and financial distress in family and non-family Brazilian companies
DOI:
https://doi.org/10.5007/2175-8069.2020v17n44p17Abstract
The aim of the study was to verify the influence of capital structure on financial distress in family and non-family brazilian companies. We conducted a descriptive, documentary and quantitative research. The sample included 137 companies, of which 65 were family members and 72 were non-family, analyzed from 2011 to 2017. It was observed that, through three measures – total debt, long-term debt and costly debt – the capital structure influences the probability of financial distress of both family and non-family companies. More importantly, these measures diverge from each other and according as from management and corporate ownership (if family or non-family companies). Thus, the contribution of this study stems from the recognition that managers, investors and other interested parties should observe capital structure measures in a different way to recognize the event of financial distress and, as a result, make assertive decisions regarding their underlying interests.
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