KEBIJAKAN DIVERSIFIKASI PERUSAHAAN DAN PENGARUHNYA TERHADAP KINERJA: STUDI EMPIRIS PADA PERUSAHAAN PUBLIK DI INDONESIA

For many years, there have been debates about the beneft and cost of corporate diversification strategy. This research provide evidence on corporate diversification and it conseqLtences toward frm value. Corporate diversification as part of internal market mechanism can have benefit and cost on performance of the rtr*. We estimate that diversification strategy will reduce firm value especially in situation like Indonesia with less-developed fnancial market and many companies still recovered .fro* monetary crises in recent years. We find that companies with diversifed business segment have negative excess value comparing with stand alone frms. In relation with firms characteristics, its show that level of leverage and asset size positively related with firm value. This result is reiecting internal capital market hypothesis