Bond and Equity Issuance Activity during COVID-19

We examine the issuance choice across rights issues of equity, unit offerings, and standalone warrants and investigate the market reactions to these issue types. We find that agency costs, growth opportunities, and current funding needs relative to assets in place are prime drivers of the type of equity issuance choice. Managers use quality signals such as underpricing, underwriting status, and the proportion of funds raised by exercising warrants in determining the features of the warrant issue. Furthermore, we document that the market reacts more favorably to standalone warrants issues than units and equity during the rights offering period.

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Countercyclical Bank Equity Issuance

SSRN Electronic Journal ◽

10.2139/ssrn.2902505 ◽

2017 ◽

Cited By ~ 10

Author(s):

Matthew D. Baron

Keyword(s):

Equity Issuance ◽

Bank Equity

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CASH FLOW, DEBT ISSUANCE, EQUITY ISSUANCE, AND FIXED ASSET INVESTMENT ON MANUFACTURE COMPANY 2010-2014CASH FLOW, DEBT ISSUANCE, EQUITY ISSUANCE, AND FIXED ASSET INVESTMENT ON MANUFACTURE COMPANY 2010-2014

Ekspektra Jurnal Bisnis dan Manajemen ◽

10.25139/ekt.v4i1.2261 ◽

2020 ◽

Vol 4 (1) ◽

pp. 11-21

Author(s):

Ritma Palupi

Keyword(s):

Cash Flow ◽

Equity Issuance ◽

Pecking Order ◽

Fixed Asset ◽

Financing Decision ◽

Manufacturing Company ◽

Debt Issuance ◽

Manufacture Company ◽

Internal Fund ◽

Fixed Asset Investment

Matters about financing decision based on pecking order theory’s hierarchy are currently appealing. This research strives to discover how corporate’s fixed asset investment reacts to cash flow, debt issuance, and equity issuance. Researcher uses 75 samples of manufacturing company in Indonesia during 2010-2014 period with 199 firm-year observation. Multiple linear regression’s result indicates that cash flow and debt issuance have influence towards corporate’s fixed asset investment, but the equity issuance have no influence towards corporate’s fixed asset investment. Also regression coefficient exhibits that manufacturing company in Indonesia follows pecking order theory’s hierarchy. Cash flow’s influence towards fixed asset investment is more significant than debt issuance’s, and debt issuance’s influence is stronger than equity issuance. This points out that corporate’s fixed asset investment is more sensitive towards cash flow (internal fund) compared to debt issuance (external fund), and so is debt issuance is more sensitive compared to equity issuance. With all that in mind, it is concluded that manufacturing company in Indonesia follows pecking order theory in terms of financing decision, which uses internal fund at first then started to use external fund if deemed necessary.

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