| Summary: | 碩士 === 國立交通大學 === 管理學院碩士在職專班財務金融組 === 97 === The Legislative Yuan in Taiwan passed the amended Securities and Future Act and Company Act in 2001, a public company may carry out private placement of securities with the following persons： natural persons, juristic persons meeting the conditions prescribed by the Competent Authority. An issuer shall not be required to deliver a prospectus to the subscriber, no application for approval to publicly offer ,no securities underwriters or lawyers to examine ,it may save enterprises cost. The Competent Authority adopts a rule of post-approval for private placement of securities, for financial crisis enterprises, the funds will speed up.
The study try to analyze private placement of securities, the declaration of private placement for stockholders wealth impact and related financial characteristics, empirical results as follows：
一、declaration effect：
If the company ever occurred financial crisis, although declaration day is positive returns, but it’s not significant, and accumulated abnormal returns is negative for the next 5 days. In 30 day accumulated abnormal returns, its curve is downward, it shows private placement declaration of the company can’t raise individual investment confidence for the company in the future.
If the company doesn’t occur financial crisis, it’s significant positive returns, it shows the market is positive response for managers raise the proportions of owner’s stock or outside stockholders may monitor the company operation.
If the company is for allied strategy, it’s positive returns, not significant, but it has abnormal returns before 2 days on the declaration day. It seems that private information flows out in advance.
In summary, no matter whatever the company has financial crisis. It has positive returns on declaration day. If the company ever occurred financial crisis, it will produce negative accumulated abnormal returns on announcement period. First declaration within 5 days of private placement, average accumulated abnormal returns show uptrend, but after 30 days, the accumulated abnormal returns is almost the same as first declaration day.
二、financial characteristics：
Compared with Seasoned Equity Offings, the financial characteristics of private placement company, EPS, the proportion of liability to total equity, returns on net worth and current ratio are all significant, enterprises will consider that Raising capital is easier, The Competent Authority approve to issue securities and banks are willing to loan. From our empirical results, we find most corporate finance is deteriorate if the company raise of capital via private rather than public placement.
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