Work

Understanding the Positive Announcement Effects of Private Equity Placements: New Insights from Hong Kong Data

Year: 2005

Type: article

Abstract: The literature has documented positive announcement effects for privately placed seasoned equity issues.This study shows positive announcement effects not only for private but also for public placements in Hong Kong. Our unique data offer new insights not obtainable from U.S. data as we examine the cross-sections of the announcement effects. Most importantly, we find that the announcement effect is more likely to be positive for smaller issuers, such as private placing firms and some public issuers where asymmetric information arises more from growth than from assets in place. This finding is consistent with the generalized Myers-Majluf model.

Source: European Finance Review

DOI: 10.1007/s10679-005-2264-y

Authors: Xueping Wu, Zheng Wang, Jun Yao

Institutions: City University of Hong Kong, CITIC Group (China)

Language: English

Topic: Corporate Finance and Governance

Subfield: Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

Open Access status: bronze

Funder: City University of Hong Kong

OpenAlex ID: W2096627493