Defrancq, CorneelHuyghebaert, NancyLuypaert, Mathieu2017-12-022017-12-02201610.1016/j.jfbs.2016.11.002http://hdl.handle.net/20.500.12127/5667We investigate how family ownership influences the industry-diversifying nature of M&As by listed companies in Continental Europe and the corresponding shareholder value effects at deal announcement. For a large sample of 3485 M&As during 2005-2013, we observe that acquirers having a family as the largest shareholder are less inclined to take over an unrelated target firm than lone-founder and other types of non-family firms. However, as the size of the family ownership stake increases, family firms become more eager to follow an industry-diversifying M&A strategy. While industry-diversifying M&As are associated with lower abnormal returns for acquirer shareholders on average, we also observe that family ownership fully reverses this negative effect. We therefore conclude that those unrelated M&As, although still representing a conflict of interest with the family firm's minority investors, do not destroy shareholder value on average.enAccounting & FinanceDiversificationMergers & AcquisitionsOwnershipFamily FirmsLone-founder FirmsCorporate GovernanceEuropeJournal of Family Business Strategy1342521154601325176968