It would be propping, since Targetti this transaction favours ESEDRA, the company where Targetti owns less cash flow rights (66% vs 70%). This is, however, the interpretation only from the "conflict of interest" perspective. One should analyze also the group dynamics (and therefore look at this graph in a "business group perspective"), to see if Targetti Polska somehow benefits from some other intragroup transaction.
As in the previous case, the reasoning is the following: 1) Where does the controlling party hold more shares (--->more interest)? in Targetti Polska. 2) Where does the money flow? To Esedra Conclusion. If it were tunnelling the controlling party would have transferred cash to the place where to get more cash (Targetti Polska, totaling 70% of profit). This does not occur in this case and therefore we might expect that this transaction is aimed at helping Esedra. Propping.
I agree with Agnese. It's propping for conflict of interest perspective but using the business group perspective this benefit for Esedra can be compensated by other intragroup transactions beneficial for Polska.
yes of course! it is propping! this transaction is intended to favor in some way Esedra, which we can assume is in a situation of financial distress. Helping Esedra, internal capital markets are used to save the firm from failure. This interpretation is valid under the "conflict of interest" perspective.
I absolutely agree with Alberto Bonaventura point of view. It is propping, because these transaction occurs under higher price than it is offered in the market and also taking into account that this transaction goes to Polsca where the % of ownership is more than ESEDRA, for sure the main target of this operation is "to save ESEDRA from failure", so it's propering. If the sutuation would be vice versa - Polsca had to sell goods to ESEDRA - it would be tunneling.
I agree with Agnese, both the conflict of interest and the group perspetive should be taken into account, however according to the first theory this is propping for sure.
When we analyze this kind of transactions we must take i account all teh stakeholders involved. That means that we should consider not only the business group but also the government for example, that may be damaged in such situation. This transaction could be a way to avoid paying some taxes, transferring assets from one country to another where the tax leve is lower (and in this case we would talk about tunneling).
I completely agree with Agnese. From a conflict of interest prespective, we consider this action as propping because Targhetti ordered Esedra to sell at a HIGHER PRICE than the market price. Looking at the percentage (66% vs 70%) we can see as Esedra with lower cash flow favours from this transaction.
Esdera (66%) Targetti Poska (70%) I agree with all of you. It can be considered as propping if we use conflict of interest perspective but using the business group perspective this can benefit for Polska, Esedra and all the group
Here we have a situation of propping, since Targetti Poloska (owned with the 70% by Targetti) acquires goods from esedra paying an higher price. Targetti does not benefit from this transaction.
I agree with Federica, it is propping because the cash flow of Targetti in ESEDRA is (66%) less than Targetti Polska (70%), and then Targetti does not benefit from this transaction.
It's correct, here we are talking about propping. In this situation the cashflow rights of Esedra is less than Targhetti Polska. Since Esedra has to sell a good at an higher price than the market one, the company benefits fron the transaction.
Guys we should also consider the advantages that Targetti could have moving profits from one country to another where the tax level could be lower for example.
I agree with my collleagues, this transaction favours ESEDRA over Targetti Polska, and, since Targetti has more cash flow rights in Targetti Polska than it does in Esedra, we have a situation of propping.
it is a propping, it is a way to help esedra maybe because it has financial distresses or could be also possible that this is an advantageous transaction that they allowed to receive back others benefits in other transactions.
I agree with all of you guys. This is propping because with this transaction targetti benefits esedra since targetti polska has to pay a price higher than the market price in order to buy the goods from Esedra.
It's propping since Esedra benefits from this transaction and the cash flow rights owned by Targetti in it are lower with respect to those owned in Targetti Polska.
I'm completely agree with you guys, is definitely propping because Traghetti owns precisely the 66% of cash flow right, less respect to the other companies.
This is a case of propping. In fact, Targetti orders to a company in which has 66% of cashflow rights to sell a good at an higher price to a company in wich has more of the cashflow rights (i.e. 70%). Doing so, Targetti benefits Esedra rather than a company in which can cash higher dividends.
I totally agree with you guys, it's absolutely propping since Esedra benefit from this transaction and also Targetti has more cash flow rights in Targetti Polska.
Let's now consider that Targetti orders to ESEDRA to sell goods to Targetti Polska at a lower price than the market price. What can we say in both perspectives? ( Conflict of interest perspective and Business group perspective)
Esedra will be demaged by this transaction. From a conflict of interest perspective we are in a tunneling case, since the cash flow rights owned by Targetti in Esedra are lower with respect to those owned in Targetti Polska. But from a business group persepective, this detrimental action could be justified by the advantage that Esedra has on being in Targetti Group and so we can't say that we are in a tunneling case.
I agree with Claudia. From a conflict of interest perspective, This transaction is detrimental for esedra since it sells at a lower price to a company in which Targetti as an higher cash flow. However, considering the business group perspective, we cannot say that it is detrimental since it can be justified by the advantage that esedra has on being part of the group.
In this case, according to the conflict of interests perspective it should be considered tunneling. In fact, such a transaction would demage the minority shareholders of Esedra benefiting Targetti Polska ( where the cash flow rights of the holding company are higher!!). If we look the same situation under the business group perspective the answear should be "It depends" becaus we should take into consideration if there is a compensatory advantage for Esedra.
I totally agree with you Giulia. In term of interest conflict perspective, this transaction is tunnerling. But when using the business group perspective, Esedra maybe receive other benefits from Targetti Polska. The transactions within the group are normal because they are more convinient than transaction with external entities.
In this different situation, I will interpret the transaction on the base of the conflict of interest perspective. Thus, I would say that the transaction becomes not beneficial for Esedra of course, but at the same time, it becomes beneficial for Targetti Polska. Therefore, since Targetti Polska is the company in which the Holding has a greater amount of cash flow rights, this is definitely a tunneling!
Now, according to the conflict of interest perspective, On one hand Esedra does not beneft from the transaction, on the other hand Targhettu Polska benefits of it. That situation results in turneling because the cash flow of Esedra are less than the Targhetti Polska's ones!
I agree with Giulia, when Targetti orders to ESEDRA (66%) to sell goods to Targetti Polska (100%) at a lower price than the market price according to the conflict of interests perspective it should be considered tunneling.
Well it depends from which perspective we are looking. If it is from a conflict of interest perspective, it is tunnelling. But if we look from a business perspective, it might be good and with advantages.
I agree with you. If we consider the restricted conflict of interest theory this is tunnelling, because the firm is trasfering money from the subsidiary in which it has less cash flow rights to that in which it has more of them. In a wider perspective it depends on the other intragroup transactions realized.
In the case of interest conflict perspective, this transaction is tunnerling. In the case of using business group perspective, The transactions within the group are normal.
From a conflict of interest perspective this transaction is detrimental for Esedra since it sells at a lower price to a company in which Targetti as an higher cash flow. From the business group perspective, we cannot say that it is beneficial or not cause we have to look at the advantage that Esedra has on being part of the group.
From a conflict of interest point of view this transaction can be seen as a case of Tunneling, as Targetti favors the company in which has more cashflowrights, namely Targetti Polska. Whereas, From a business group point of View may be that Esedra gains other types of benefits from this transaction.
i think that the possibility to consider tunneling here is right just because on the conflict of interest perspective, it could beneficial to make transactions from esedra to targetti polska because the controlling party has a little bit of more cash flows right but i don't think that it will be a tactic made to earn more because the differential of earnings doesn't vary so much. So maybe if we analyze the business group perspective we can understand better that maybe there will be other reciprocal transactions from targetti polska to esedra that will balance the exchange.
I agree with you, it could be propping because resources are transfered from a company in which Targetti has the 70% of cash flow rights to a company in which Targetti has the 66% of cash flow rights. However, using the business group theory, we should consider that, if Targetti declares to direct and coordinate its subsidiaries, there could be a compensation to this detrimental transaction for the minority shareholders of Targetti Polska, thanks to its belonging to the group.
It could be propping. Using both perspectives (business group and conflict of interest) this internal transaction could be considered positive (or indifferent) for the group and companies involved, unlikely to be a negative transaction. We may talk of propping because the transaction seem to benefit a company (Esedra) in which the controller has fewer cash flow rights than he has in the company (TPolska) who is appearently loosing money in the operation. That may be read as an help for a "distressing" Esedra, which may be saved from failure thanks to this transaction.
It is propping, because this transaction is beneficial for Esedra (in fact, targetti polska has to pay a higher price than the market price in order to purchase goods from Esedra).
According to the conflict of interest perspective, when Targetti oders Esedra (66%) sell goods to Targetti Polska (70%) at lower price than market price, this transaction will damage seller, benefit buyer. Therefore, in my opinion it should be tunneling.
Thuy, from a conflict of interest perspective, this transaction is detrimental for esedra because it sells at a lower price to a company in which Targetti as an higher cash flow. Concerning, instead, the business group perspective, Esedra may receive other benefits from Targetti Polska.
On my point of view, we should have a look on the ownership percentage of the holding co. in both subsidiaries before answering to this question. Secondly, we have to apply the theories about rpts that we have studied. Depending on which of them we will adopt, there would be different answers aned consequences.
guys, thanks for your answers, now how do you think if Targetti order to Neri to sell goods to Targetti North America at a lower price than the market price?
I don't know, maybe we have to understand motivations behind this transaction. In my opinion from the conflict of interest prespective this transaction could benefits Targhetti North America.
Propping- Targetti orders to Dura Lamp (51% owned) to finance Esedra (66% owned) through a loan with a higher interest rate than the one provided by the market. Dura Lamp will obviuosly beneficiate of the transaction conditions.
Tunneling- same case but with a lower interest rate than the one provided by the market. Of course Esedra will get money under favourable conditions.
Propping: Targetti orders to Victoria MLE srl to sell goods to Duratel charging a price lower than the market one. Tunneling: Targetti orders to Victoria MLE srl to sell goods to Duratel charging an higer price than the market one
An example of tunneling: Targetti holding company orders Neri (100%) sell the product to DMF Ltd Cina (26%) at the price higher than the fair market condition
hii guys, is it propping or tunneling if Targetti order to Targetti North America to sell goods to Targetti Licht Gmbh (Germania) at a higher price than the market price?
We can see at this transactions considering that Targetti North America is facing a decline situation. In this case, it would be propping since the transaction give benefits to TargettiNorth America instead of Targetti Licht.
Basically we have Targetti North America which is owned with 100% and Targetti Licht gmbh which is owned with 100% as well. If the price is greater than the market price it means that the transaction is providing advantages to Targetti North America. Therefore, the only reason we could expect in order to interpret this deal, is given by the assumption that Targetti North America is in financial difficulties, and it has to be saved.
Following Camilla's example it would be propping. The holding co. has the same control level in both firms and so it will have interest in such transactions only in case of subsidiaries' crisis.
we can consider this case as propping because Targhetti is the only owner of the two companies. In this case, the transaction seems to give benefits to TargettiNorth America instead of Targetti Licht.
Mello don't worry you are right if you use the conflict of interest perspective because Esedra takes advantage of the transaction and Targetti owns in Esedra less cash flow rights than in Targetti Polska, so targetti is not trying to get private benefits from this transaction. If we use the business group perspective it depends.
I am not sure but I think that the high presence of companies belonging to a group with major shareholders in Italy, for sure affect the likelihood of the phenomenon of tunneling.
It would be propping, since Targetti this transaction favours ESEDRA, the company where Targetti owns less cash flow rights (66% vs 70%). This is, however, the interpretation only from the "conflict of interest" perspective. One should analyze also the group dynamics (and therefore look at this graph in a "business group perspective"), to see if Targetti Polska somehow benefits from some other intragroup transaction.
ReplyDeleteAs in the previous case, the reasoning is the following:
Delete1) Where does the controlling party hold more shares (--->more interest)? in Targetti Polska.
2) Where does the money flow? To Esedra
Conclusion. If it were tunnelling the controlling party would have transferred cash to the place where to get more cash (Targetti Polska, totaling 70% of profit). This does not occur in this case and therefore we might expect that this transaction is aimed at helping Esedra. Propping.
I agree with Agnese. It's propping for conflict of interest perspective but using the business group perspective this benefit for Esedra can be compensated by other intragroup transactions beneficial for Polska.
DeleteI completely agree with Agnese,it depends from the perspective we use,but in this case,differently from the other ones it should be propping.
Deleteyes of course! it is propping! this transaction is intended to favor in some way Esedra, which we can assume is in a situation of financial distress. Helping Esedra, internal capital markets are used to save the firm from failure. This interpretation is valid under the "conflict of interest" perspective.
Deleteit depends from the aspect we use,but in this case it should be propping.
DeleteI absolutely agree with Alberto Bonaventura point of view. It is propping, because these transaction occurs under higher price than it is offered in the market and also taking into account that this transaction goes to Polsca where the % of ownership is more than ESEDRA, for sure the main target of this operation is "to save ESEDRA from failure", so it's propering. If the sutuation would be vice versa - Polsca had to sell goods to ESEDRA - it would be tunneling.
DeleteIt is propping, because it is benefitial to Esdera which has 66% while Targetti Poska has 70%.
DeleteIf it were tunnelling the controlling party would have transferred cash to the place for getting more cash. And in this case, It doesn't happen.
DeleteThis transaction is propping, since it is good to Esdera which has 66% compared to Targetti Poska has 70%.
DeleteI agree with Agnese, both the conflict of interest and the group perspetive should be taken into account, however according to the first theory this is propping for sure.
DeleteWhen we analyze this kind of transactions we must take i account all teh stakeholders involved. That means that we should consider not only the business group but also the government for example, that may be damaged in such situation. This transaction could be a way to avoid paying some taxes, transferring assets from one country to another where the tax leve is lower (and in this case we would talk about tunneling).
DeleteI completely agree with Agnese. From a conflict of interest prespective, we consider this action as propping because Targhetti ordered Esedra to sell at a HIGHER PRICE than the market price. Looking at the percentage (66% vs 70%) we can see as Esedra with lower cash flow favours from this transaction.
DeleteEsdera (66%)
DeleteTargetti Poska (70%)
I agree with all of you. It can be considered as propping if we use conflict of interest perspective but using the business group perspective this can benefit for Polska, Esedra and all the group
Here we have a situation of propping, since Targetti Poloska (owned with the 70% by Targetti) acquires goods from esedra paying an higher price. Targetti does not benefit from this transaction.
ReplyDeleteI agree with Federica, it is propping because the cash flow of Targetti in ESEDRA is (66%) less than Targetti Polska (70%), and then Targetti does not benefit from this transaction.
DeleteI also agree with Federica; it is propping because Targetti in this case benefits Esedra
Deleteyes, I agree with you. Instead, what about the interpretation of this transaction under the other perspective ("the business group perspective") ??
DeleteIt's correct, here we are talking about propping. In this situation the cashflow rights of Esedra is less than Targhetti Polska. Since Esedra has to sell a good at an higher price than the market one, the company benefits fron the transaction.
DeleteI also agree with federica.
Deleteit is propping and Esedra cash flow rights is less than Targhetti
DeleteGuys we should also consider the advantages that Targetti could have moving profits from one country to another where the tax level could be lower for example.
DeleteI also agree with your points, Targetti doesnt benefit from this transaction
Deleteyes, it is propping. However, when we consider the business group perspective, this transaction can benefit both subsidiaries and the group
DeleteIt is propping anf Targetti doesn't benefit from this transaction.
DeleteI agree with my collleagues, this transaction favours ESEDRA over Targetti Polska, and, since Targetti has more cash flow rights in Targetti Polska than it does in Esedra, we have a situation of propping.
ReplyDeleteit is a propping, it is a way to help esedra maybe because it has financial distresses or could be also possible that this is an advantageous transaction that they allowed to receive back others benefits in other transactions.
ReplyDeleteI agree with all of you guys. This is propping because with this transaction targetti benefits esedra since targetti polska has to pay a price higher than the market price in order to buy the goods from Esedra.
ReplyDeleteIt's propping since Esedra benefits from this transaction and the cash flow rights owned by Targetti in it are lower with respect to those owned in Targetti Polska.
ReplyDeleteI'm completely agree with you guys, is definitely propping because Traghetti owns precisely the 66% of cash flow right, less respect to the other companies.
ReplyDeleteIt is propping because Targetti has higher cash flow rights in Targetti Polska than in Esedra
ReplyDeleteThis is a case of propping. In fact, Targetti orders to a company in which has 66% of cashflow rights to sell a good at an higher price to a company in wich has more of the cashflow rights (i.e. 70%). Doing so, Targetti benefits Esedra rather than a company in which can cash higher dividends.
ReplyDeleteI totally agree with you guys, it's absolutely propping since Esedra benefit from this transaction and also Targetti has more cash flow rights in Targetti Polska.
DeleteThis is a propping case. Firstly we have to take a look of the percentage. Secondly, we can easily see that Esedra takes benefit from this action.
ReplyDeleteLet's now consider that Targetti orders to ESEDRA to sell goods to Targetti Polska at a lower price than the market price. What can we say in both perspectives? ( Conflict of interest perspective and Business group perspective)
ReplyDeleteEsedra will be demaged by this transaction. From a conflict of interest perspective we are in a tunneling case, since the cash flow rights owned by Targetti in Esedra are lower with respect to those owned in Targetti Polska. But from a business group persepective, this detrimental action could be justified by the advantage that Esedra has on being in Targetti Group and so we can't say that we are in a tunneling case.
DeleteI agree with Claudia. From a conflict of interest perspective, This transaction is detrimental for esedra since it sells at a lower price to a company in which Targetti as an higher cash flow. However, considering the business group perspective, we cannot say that it is detrimental since it can be justified by the advantage that esedra has on being part of the group.
DeleteIn this case, according to the conflict of interests perspective it should be considered tunneling. In fact, such a transaction would demage the minority shareholders of Esedra benefiting Targetti Polska ( where the cash flow rights of the holding company are higher!!).
DeleteIf we look the same situation under the business group perspective the answear should be "It depends" becaus we should take into consideration if there is a compensatory advantage for Esedra.
I totally agree with you Giulia. In term of interest conflict perspective, this transaction is tunnerling. But when using the business group perspective, Esedra maybe receive other benefits from Targetti Polska. The transactions within the group are normal because they are more convinient than transaction with external entities.
DeleteIn this different situation, I will interpret the transaction on the base of the conflict of interest perspective. Thus, I would say that the transaction becomes not beneficial for Esedra of course, but at the same time, it becomes beneficial for Targetti Polska. Therefore, since Targetti Polska is the company in which the Holding has a greater amount of cash flow rights, this is definitely a tunneling!
DeleteNow, according to the conflict of interest perspective, On one hand Esedra does not beneft from the transaction, on the other hand Targhettu Polska benefits of it. That situation results in turneling because the cash flow of Esedra are less than the Targhetti Polska's ones!
DeleteI agree with Giulia, when Targetti orders to ESEDRA (66%) to sell goods to Targetti Polska (100%) at a lower price than the market price according to the conflict of interests perspective it should be considered tunneling.
DeleteWell it depends from which perspective we are looking. If it is from a conflict of interest perspective, it is tunnelling. But if we look from a business perspective, it might be good and with advantages.
DeleteFrom a conflict of interest approach, it is tunnelling. But from a business perspective, it is beneficial.
DeleteI agree with you. If we consider the restricted conflict of interest theory this is tunnelling, because the firm is trasfering money from the subsidiary in which it has less cash flow rights to that in which it has more of them. In a wider perspective it depends on the other intragroup transactions realized.
DeleteIn the case of interest conflict perspective, this transaction is tunnerling. In the case of using business group perspective, The transactions within the group are normal.
DeleteFrom a conflict of interest perspective this transaction is detrimental for Esedra since it sells at a lower price to a company in which Targetti as an higher cash flow.
DeleteFrom the business group perspective, we cannot say that it is beneficial or not cause we have to look at the advantage that Esedra has on being part of the group.
From a conflict of interest point of view this transaction can be seen as a case of Tunneling, as Targetti favors the company in which has more cashflowrights, namely Targetti Polska. Whereas, From a business group point of View may be that Esedra gains other types of benefits from this transaction.
Deletei think that the possibility to consider tunneling here is right just because on the conflict of interest perspective, it could beneficial to make transactions from esedra to targetti polska because the controlling party has a little bit of more cash flows right but i don't think that it will be a tactic made to earn more because the differential of earnings doesn't vary so much. So maybe if we analyze the business group perspective we can understand better that maybe there will be other reciprocal transactions from targetti polska to esedra that will balance the exchange.
ReplyDeleteIt’s propping. We have to look a the cash flow right
ReplyDeleteI agree with you, it could be propping because resources are transfered from a company in which Targetti has the 70% of cash flow rights to a company in which Targetti has the 66% of cash flow rights. However, using the business group theory, we should consider that, if Targetti declares to direct and coordinate its subsidiaries, there could be a compensation to this detrimental transaction for the minority shareholders of Targetti Polska, thanks to its belonging to the group.
ReplyDeleteIt could be propping. Using both perspectives (business group and conflict of interest) this internal transaction could be considered positive (or indifferent) for the group and companies involved, unlikely to be a negative transaction.
ReplyDeleteWe may talk of propping because the transaction seem to benefit a company (Esedra) in which the controller has fewer cash flow rights than he has in the company (TPolska) who is appearently loosing money in the operation. That may be read as an help for a "distressing" Esedra, which may be saved from failure thanks to this transaction.
It is propping, because this transaction is beneficial for Esedra (in fact, targetti polska has to pay a higher price than the market price in order to purchase goods from Esedra).
ReplyDeleteThis comment has been removed by the author.
ReplyDeleteHii guys, is it propping or tunneling if Targetti order to ESEDRA to sell goods to Targetti Polska (Polonia) at a lower price than the market price?
ReplyDeleteAccording to the conflict of interest perspective, when Targetti oders Esedra (66%) sell goods to Targetti Polska (70%) at lower price than market price, this transaction will damage seller, benefit buyer. Therefore, in my opinion it should be tunneling.
DeleteThuy, from a conflict of interest perspective, this transaction is detrimental for esedra because it sells at a lower price to a company in which Targetti as an higher cash flow. Concerning, instead, the business group perspective, Esedra may receive other benefits from Targetti Polska.
DeleteOn my point of view, we should have a look on the ownership percentage of the holding co. in both subsidiaries before answering to this question. Secondly, we have to apply the theories about rpts that we have studied. Depending on which of them we will adopt, there would be different answers aned consequences.
Deleteguys, thanks for your answers, now how do you think if Targetti order to Neri to sell goods to Targetti North America at a lower price than the market price?
DeleteI don't know, maybe we have to understand motivations behind this transaction. In my opinion from the conflict of interest prespective this transaction could benefits Targhetti North America.
DeleteI think we need further pieces of information. Maybe it could be that Targetti wants to subtract some assets to the creditors of Neri.
DeleteGuys, could you provide me with an example of propping and one of tunneling (if any) using this figure?? Thanks!
ReplyDeletePropping- Targetti orders to Dura Lamp (51% owned) to finance Esedra (66% owned) through a loan with a higher interest rate than the one provided by the market. Dura Lamp will obviuosly beneficiate of the transaction conditions.
DeleteTunneling- same case but with a lower interest rate than the one provided by the market. Of course Esedra will get money under favourable conditions.
Totally agree with Lorenzo.
DeletePerfect example!
DeletePropping: Targetti orders to Victoria MLE srl to sell goods to Duratel charging a price lower than the market one.
DeleteTunneling: Targetti orders to Victoria MLE srl to sell goods to Duratel charging an higer price than the market one
An example of tunneling: Targetti holding company orders Neri (100%) sell the product to DMF Ltd Cina (26%) at the price higher than the fair market condition
Deletehii guys, is it propping or tunneling if Targetti order to Targetti North America to sell goods to Targetti Licht Gmbh (Germania) at a higher price than the market price?
ReplyDeleteSince these subsidiaries are owned entirely by Targetti, this could be interpreted as propping.
DeleteWe can see at this transactions considering that Targetti North America is facing a decline situation. In this case, it would be propping since the transaction give benefits to TargettiNorth America instead of Targetti Licht.
DeleteBasically we have Targetti North America which is owned with 100% and Targetti Licht gmbh which is owned with 100% as well. If the price is greater than the market price it means that the transaction is providing advantages to Targetti North America. Therefore, the only reason we could expect in order to interpret this deal, is given by the assumption that Targetti North America is in financial difficulties, and it has to be saved.
DeleteI'm agree with Luca, we can interpret this as propping because the subsidiaries are owned at 100% by Targetti.
Deleteit is propping because Targetti is the only one owner of both the companies:
DeleteFollowing Camilla's example it would be propping. The holding co. has the same control level in both firms and so it will have interest in such transactions only in case of subsidiaries' crisis.
Deletewe can consider this case as propping because Targhetti is the only owner of the two companies. In this case, the transaction seems to give benefits to TargettiNorth America instead of Targetti Licht.
DeleteYep i agree, i think there is no motivation for tunneling in this case
DeleteIt is propping since he is the only owner.
DeleteMaybe if i'm understand something should be propping .guys if i'm wrong please correct me cause i'm studing from abroad!
ReplyDeleteYou are absolutely right, dear Mello.
DeleteMello don't worry you are right if you use the conflict of interest perspective because Esedra takes advantage of the transaction and Targetti owns in Esedra less cash flow rights than in Targetti Polska, so targetti is not trying to get private benefits from this transaction. If we use the business group perspective it depends.
ReplyDeleteguys do you think that tunneling in italy is more lilkely to happen respect to other conuntries, due to the legal type of governance structure?
ReplyDeleteAbsolutely yes Cristina
ReplyDeleteI am not sure but I think that the high presence of companies belonging to a group with major shareholders in Italy, for sure affect the likelihood of the phenomenon of tunneling.
ReplyDelete