How Different Is Japanese Corporate Finance? An Investigation of the Information Content of New Security Issues
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This article studies the shareholder wealth ef- fects associated with 875 new security issues in Japan from January 1,1985, to May 31,1991. The announcement of convertible debt issues has a significant positive abnormal return of 1.05 percent. There is an abnormal return of 0.45 percent at the announcement of equity issues that is off-set by an abnormal return of 1.01 percent on the
issue day. Abnormal returns are negatively related to firm size, so that large Japanese firms have abnormal returns less different from those of U.S. firms than small Japanese firms. Our evidence is consistent with the view that Japanese
managers decide to issue shares based on different considerations than American managers.
Added: April, 03rd 2010
File size: 2.97mb
Tags: japanese corporate finance, new security issues, security issues, abnormal returns, japanese firms, japanese managers, stock price reaction