The Discount of Private Equity Placement－The Impact of Corporate Governance, Earnings Management, and Intangible Assets
Date Issued
2007
Date
2007
Author(s)
Chang, Ju-Hsin
DOI
zh-TW
Abstract
The mechanism of private equity placement in Taiwan provides firms with more convenient way to raise their funds. However, in contrast to public issues, it excludes the priority of existing shareholders from buying new shares and dilutes their interests through discount of issue price for specific purpose. The purpose of this study is to investigate whether the discount of private equity placement is afftected by the mechanism of corporate governance, firms’ earnings management behavior and the magnitude of intangible assets.
The empirical findings of this study document that the discount of private equity placement is greater when the percentage of the directors’ and supervisors’ shareholdings that are pledged is larger. The discount is negatively related to the directors’ and supervisors’ shareholdings, the ratio of independent directors and supervisors over board size, and the ratio of directors and supervisors who are also mangers over board size. In addition, the firms’ earnings management behavior proxied by sale on investment is positively related to the discount of private equity placement. Finally, the the magnitude of intangible assets measured by book-to-market ratio is negatively related to the discount of private equity placement. In gereral, the results support hypotheses proposed by this study.
Subjects
私募折價
公司治理機制
盈餘管理行為
無形資產
裁決性應計項目
the discount of private equity placement
corporate governance
earnings management
intangible assets
discretionary accrual
Type
other
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ntu-96-R93722033-1.pdf
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