Effects of regulator's announcements, information asymmetry and ownership changes on private equity placements: evidence from China

M M Fonseka; Sisira Reginold Nishantha Colombage; Gao-Liang Tian

doi:10.1016/j.intfin.2013.11.008

Effects of regulator's announcements, information asymmetry and ownership changes on private equity placements: evidence from China

M M Fonseka, Sisira Reginold Nishantha Colombage, Gao-Liang Tian

Research output: Contribution to journal › Article › Research › peer-review

13 Citations (Scopus)

Abstract

In response to the China Securities Regulatory Commission s regulation of private equity placements (PEP) in 2006, this study investigates the impact of the announcements of PEP applications, withdrawals, rejections, approvals, and completions on the returns of the firms that issue private equity (PE) and the factors that influence market reactions to these announcements. The results show that issuing firms experience stock price responses only to the announcements of PE applications, approvals, and completions. The announcement effect is positively related to the market discount, proceeds from private placements, and private institutional buying and ownership changes; and negatively related to government or government institutional buying and changes in the ownership of management buyers.

Original language	English
Pages (from-to)	126 - 149
Number of pages	24
Journal	Journal of International Financial Markets, Institutions and Money
Volume	29
Issue number	1
DOIs	https://doi.org/10.1016/j.intfin.2013.11.008
Publication status	Published - 2014

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Fonseka, M. M., Colombage, S. R. N., & Tian, G-L. (2014). Effects of regulator's announcements, information asymmetry and ownership changes on private equity placements: evidence from China. Journal of International Financial Markets, Institutions and Money, 29(1), 126 - 149. https://doi.org/10.1016/j.intfin.2013.11.008

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Effects of regulator's announcements, information asymmetry and ownership changes on private equity placements: evidence from China. / Fonseka, M M; Colombage, Sisira Reginold Nishantha; Tian, Gao-Liang.

In: Journal of International Financial Markets, Institutions and Money, Vol. 29, No. 1, 2014, p. 126 - 149.

Research output: Contribution to journal › Article › Research › peer-review

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