Regulatory Scrutiny Prior to Seasoned Equity Offerings: Evidence From SEC Comment Letters
Year: 2026
Type: article
Abstract: ABSTRACT We investigate how the Securities and Exchange Commission's (SEC) oversight affects the timing and valuation of seasoned equity offerings (SEOs). SEOs receiving an SEC comment letter are associated with longer SEO registration periods. Furthermore, SEOs receiving an SEC comment letter that is publicly disclosed before the offer date are associated with larger offer price discounts. Issuers with poorer information environments are more likely to receive an SEC comment letter. Our findings are consistent with SEC scrutiny resulting in negative information being incorporated into the offer price, but only when the scrutiny is disclosed publicly and promptly.
Source: Financial Review
DOI: 10.1111/fire.70058
Institutions: George Mason University, Oakland University, University of Georgia
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W7155187640