The Empirical Research For The Announcement Effect And Influential Factors Of Private Placements In China's Listed Companies

In 2006, private placements became a brand-new equity financing tool in China's securities market after the reform of splitting stocks. In 2007, related regulations for the implementation of private placements in the listed companies further clarified the specific details of the private placements. Compared with other equity financing tools, because of its high efficiency and low cost, private placements soon became the favorite financing tool of the listed companies. But some problems also emerged in the mean time. Either the practical application or the theory research of private placements is more mature abroad. Due to the short time of application, the research about private placements in China is unsystematic. The announcement effect of private placements which reflect the attitude and expectation of investors in securities market is one of important fields to research. Under different policy and system background, the announcement effect of private placements must differ. This thesis aims to study the announcement effect and influential factors of private placements in China's securities market and system.After the discussion about the regulations and current status of private placements in China's listed companies, this thesis selects the listed companies that announced private placements in 2008-2010 as the sample to study the announcement effect and influential factors of private placements using event study and multiple regression analysis. Firstly, this thesis makes hypothesizes and chooses influential factors based on the review of related literature and theory analysis, Then observe the AR and CAR,which measuring announcement effect of private placement, around the announcement day. Further more, the sample is divided into different groups according three standards including the issuing motive, issuing object and buying patterns to study the difference between groups. Secondly, this thesis makes regression analysis of the multiple-regression model to examine the relationship between the influential factors and the announcement effect.The results of the empirical analysis show that the announcement effect of private placements is significantly positive in China. And the effected factors include the issuing motive, issuing object, buying patterns, company size and debt level. Finally, this thesis also explains these results briefly and makes some suggestions.