Fleming, GrantOliver, BarrySkourakis, Steve2015-12-130810-5391http://hdl.handle.net/1885/74792This paper refines the Berger and Ofek (1995) methodology to estimate the valuation discount of multi-segment firms in Australia between 1988 and 1998. Evidence is found that based on earnings before tax, the sample of multi-segment firms traded at a 29 per cent greater discount than a comparable portfolio of single segment firms over the sample period. To explain the results further analysis shows that the valuation discount was driven by poorly performing multi-segment firms rather than multi-segment firms per se. This raises questions about studies that conclude that diversification is value destroying.Keywords: Diversification; Ownership structure200310.1111/1467-629X.000872016-02-24