Determinants influencing the choice of equity private placement

Norhanim Dewa, Izani Ibrahim

    Research output: Contribution to journalArticle

    1 Citation (Scopus)

    Abstract

    Private placement of equity (PPE) is one of the accessible financing tools used by company to raise funds. The recent inclination of PPE exercise is pertinent for further research including in Malaysia. The research objective is to establish the factors which influence firms to issue equity privately. The research is aim to test the relationship of earning performance, asymmetric information, stock price run-up, agency cost and firm size theory with the choice to raise PPE. Sample is collected through the list of companies that announce the issuance of PPE in Bursa Malaysia. The announcements are from the year 2002 to 2007. The finding revealed that smaller firms which suffer asymmetric information as well as negative earning performance will choose equity private placement as their capital raising exercises.

    Original languageEnglish
    Pages (from-to)15-26
    Number of pages12
    JournalInternational Research Journal of Finance and Economics
    Volume39
    Publication statusPublished - May 2010

    Fingerprint

    Private placement
    Equity
    Exercise
    Asymmetric information
    Malaysia
    Agency costs
    Small firms
    Firm size
    Stock prices
    Influence factors
    Announcement
    Equity issues
    Financing

    Keywords

    • Agency cost
    • Asymmetric information
    • Earning performance
    • Equity private placement
    • Firm size
    • Price run-up

    ASJC Scopus subject areas

    • Economics and Econometrics
    • Finance

    Cite this

    Determinants influencing the choice of equity private placement. / Dewa, Norhanim; Ibrahim, Izani.

    In: International Research Journal of Finance and Economics, Vol. 39, 05.2010, p. 15-26.

    Research output: Contribution to journalArticle

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