Research On The Relationship Of Secondarty Equity Offering And Cash Dividend Distribution In China's Listed Companies

Cash dividend policy is one of the important research content of modern corporation financial management. It not only relates to the allocation of surplus profit, but also has a close relation to the secondary equity offering of the listed corporations. In our country, China has strict supervision of the behaviors of secondary equity offering. In order to meet the desire for capital, Some listed companies may use cash dividend distribution to satisfy the secondary equity offering limits of SEC, and this may cause to some listed companies have abnormal cash dividend distribution behaviors before and after the behaviors of secondary equity offering,this is just the starting point of this study.At first, this dissertation reviews the predecessors study about dividends policy. Then I analyze the dividends theory, the secondary equity offering theory and related supervision policy. Through the special supervision system of secondary equity offering, Cash dividend policy is firmly related with the qualifications of secondary equity offering, the listed corporations satisfy the refinancing limits of SEC by using dividend distribution, which results in behaviors of secondary equity offering becomes an motivation of Chinese listed corporations' paying cash dividends, providing the breakthrough point of the research. Next, the article makes an analysis of the cash dividends and the secondary equity offering situation in our country and brings up empirical hypothesis.This paper explores the effect of the secondary equity offering of listed corporations on their cash dividend policies through descriptive statistics, independent sample mean comparison, logistic regression analysis, multivariate linear regression analysis and other methods, by using all the listed companies as sample that either they have secondary equity offering behaviors or not, the inclination of cash dividend distribution and cash dividend per share as independent variable, secondary equity offering including secondary public offering, right offering and convertible security as independent variable, the proportion of the first largest shareholder, the proportion of the second to ten largest shareholder, the nature of controlling shareholder, the size of the board,the proportions of the independent directors, the proportion of top executives shares, total assets,asset-liability ratio, revenue income growth rate and ROE as control variables. The paper explores, in or before the year of secondary equity offering, the effect of the secondary equity offering on their cash dividend policies, and the sample encompasses a 3-year period from 2007 to 2009.The empirical results show that, in the year before secondary equity offering, the behaviors of secondary equity offering have a noticeable impact on the inclination of cash dividend distribution and the level of Cash dividend distribution. It indicates that, in the year before secondary equity offering, Chinese listed companies may provide cash dividends to meet the supervision conditions of secondary equity offering in order to fill the need for capital. In the year of secondary equity offering, there is a significant positive correlation of the inclination of cash dividend distribution and the secondary equity offering behaviors in Chinese listed companies, but the behaviors of the secondary equity offering have a positive effect on the level of Cash dividend distribution but not noticeable. This suggests that, in the year of secondary equity offering, through the "legal" yet unreasonable distribution of cash dividends, the majority shareholders may divert cash of listed corporations for the benefit of private individuals, and seriously infringed on the benefits of small and medium investors. The finding shows that the behavior of secondary equity offering has become an important factor that affects cash dividends policy.At last, based on the theory analysis and empirical test, I bring up some suggestions to standard the dividends policy and the secondary equity offering policy.