This paper investigates the impact of non-managerial and managerial blockholders on the value of the firms listed in the Alternative Investment Market (AIM). This study mainly investigates whether the effect of blockholders on firm value is due to the AIM high ownership concentration and low investor protection. The primary empirical finding, using GMM, justifies that non-managerial and managerial blockholders in the AIM affect the firm value in different ways. Non-managerial blockholders in the AIM improve the firm value by monitoring managers when their block sizes are up to 32 per cent. However, when their block sizes exceed 32 per cent, the blockholders expropriate other shareholders.

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The views, findings and recommendations expressed in this Article are those of the authors and do not necessarily represent those of the Institutions for which they work.

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