The study aims to examine the announcement effects on shareholders’ returns among the Malaysia firms associated with decision of switching business focus during the study period of 2010 to 2015. In addition to apply an event study methodology, there are 66 announcements related to business switching have been analyzed. Based on the analysis, the main finding of the study indicates positive share returns of around 6% on the announcement day. However, the result shows insignificant value which suggesting that business decision for switching the business direction carry an implication value for capital market in terms of increasing shareholders’ value. While, the insignificant share returns for shareholders could be dedicated to possible reason of premature leakage information and the timing for information release. Perhaps, the timing of information arrival to public coincides with other positive market events could lead to this result. Also, the result emphasizes conclusive evidence of the Malaysia capital market characteristics with the semi strong efficient market. Moreover, the motive for changing business focus on share returns prediction is correlated with the various indicators of economic activities in the capital market.
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