1. Whether an investor has a high, medium or low level of agency cost
2. The type of agency cost likely to be assume an investor
3. The type of corporate governance mechanism which would be appropriate in addressing the type of agency cost

ABC Ltd, an Australian based firm is a large manufacturing firms with 25 subsidiaries which operates from different part of the world. On 30thJuly 2018, Birim Equity fund acquired an additional 25% of shares of ABC Ltd resulting in its total shareholding of 48%. The Herald Sun in its business segment described the acquisition as one which makes Birim Equity a dominant shareholder. How would this situation affect agency cost for prospective investor if

1. Birim Equity is separated from management
2. Birim Equity is not separated from management