TY - JOUR
T1 - Policy uncertainty and seasoned equity offerings methods
AU - Dang, Man
AU - Puwanenthiren, Premkanth
AU - Thai, Hong An
AU - Mazur, Mieszko
AU - Jones, Edward
AU - Vo, Xuan Vin
N1 - Funding Information:
This paper receives funding from the Vietnam Ministry of Education and Training (Ministry-level Research Project) under grant number B2020-DNA-11B2020-DNA-11 , except the last author, Xuan Vinh Vo receives funding from the University of Economics Ho Chi Minh City.
Funding Information:
Man Dang is an Associate Professor, and Hong An Thai is a senior lecturer, at University of Economics, the University of Danang (Vietnam); Premkanth Puwanenthiren is a senior lecturer at the University of Westminster (UK); Xuan Vinh Vo is a professor at the University of Economics Ho Chi Minh City (Vietnam); Mieszko Mazur is a professor at IESEG School of Management (France); and Edward Jones is a professor at Heriot-Watt University (UK). We thank the members of the UE-UD Teaching and Research Team in Corporate Finance and Asset pricing (TRT-CFAP), the participants at the 2019 Australasian Finance and Banking Conference, the 2019 Financial Markets and Corporate Governance Conference, and seminars at Edinburgh Business School and Westminster Business School, for very fruitful comments and suggestions. This paper is funded by the Vietnam Ministry of Education and Training (Ministry-level Research Project) under grant number B2020-DNA-11, except the last author, Xuan Vinh Vo receives funding from the University of Economics Ho Chi Minh City. All remaining errors are our own. Authors' contact information: Man Dang: [email protected]; Premkanth Puwanenthiren: [email protected]; Hong An Thai: [email protected]. Mieszko Mazur: [email protected]; Edward Jones: [email protected]; Xuan Vinh Vo: [email protected] paper receives funding from the Vietnam Ministry of Education and Training (Ministry-level Research Project) under grant number B2020-DNA-11B2020-DNA-11, except the last author, Xuan Vinh Vo receives funding from the University of Economics Ho Chi Minh City.
Funding Information:
Man Dang is an Associate Professor, and Hong An Thai is a senior lecturer, at University of Economics, the University of Danang (Vietnam) ; Premkanth Puwanenthiren is a senior lecturer at the University of Westminster (UK) ; Xuan Vinh Vo is a professor at the University of Economics Ho Chi Minh City (Vietnam); Mieszko Mazur is a professor at IESEG School of Management (France) ; and Edward Jones is a professor at Heriot-Watt University (UK) . We thank the members of the UE-UD Teaching and Research Team in Corporate Finance and Asset pricing (TRT-CFAP), the participants at the 2019 Australasian Finance and Banking Conference, the 2019 Financial Markets and Corporate Governance Conference, and seminars at Edinburgh Business School and Westminster Business School , for very fruitful comments and suggestions. This paper is funded by the Vietnam Ministry of Education and Training (Ministry-level Research Project) under grant number B2020-DNA-11, except the last author, Xuan Vinh Vo receives funding from the University of Economics Ho Chi Minh City. All remaining errors are our own. Authors' contact information: Man Dang: [email protected] ; Premkanth Puwanenthiren: [email protected] ; Hong An Thai: [email protected] . Mieszko Mazur: [email protected] ; Edward Jones: [email protected] ; Xuan Vinh Vo: [email protected] .
Publisher Copyright:
© 2021 Elsevier Inc.
PY - 2021/10
Y1 - 2021/10
N2 - Based on a sample of U.S. seasoned equity offering (SEO) during the period 2002–2017, we examine how the choice of equity issuance method changes in response to policy uncertainty. We find that firms subject to high policy uncertainty are less likely to use accelerated offerings rather than other types of traditional seasoned equity offerings. Our results are robust to alternative variable specifications, propensity score matching method, IV approach, and the inclusion of additional controls. Also, the effect of policy uncertainty on accelerated offering decision is weaker for firms with better information environment, earnings quality, and governance structures. Further, policy uncertainty increases the cost of funds and lowers long-run abnormal returns after SEOs for firms subject to high levels of policy uncertainty.
AB - Based on a sample of U.S. seasoned equity offering (SEO) during the period 2002–2017, we examine how the choice of equity issuance method changes in response to policy uncertainty. We find that firms subject to high policy uncertainty are less likely to use accelerated offerings rather than other types of traditional seasoned equity offerings. Our results are robust to alternative variable specifications, propensity score matching method, IV approach, and the inclusion of additional controls. Also, the effect of policy uncertainty on accelerated offering decision is weaker for firms with better information environment, earnings quality, and governance structures. Further, policy uncertainty increases the cost of funds and lowers long-run abnormal returns after SEOs for firms subject to high levels of policy uncertainty.
KW - Multinomial logistic regression
KW - Policy uncertainty
KW - Propensity score matching, IV approach
KW - Seasoned equity offerings
UR - http://www.scopus.com/inward/record.url?scp=85110219841&partnerID=8YFLogxK
U2 - 10.1016/j.irfa.2021.101830
DO - 10.1016/j.irfa.2021.101830
M3 - Article
SN - 1057-5219
VL - 77
JO - International Review of Financial Analysis
JF - International Review of Financial Analysis
M1 - 101830
ER -