The Research On The Effect Of Private Placement Announcement On Listed Companies

Since private placement system officially started in May2006to March2012, a total of779listed companies in the Shanghai Stock Exchange A-share market have made project financing or promoted asset injection through private placement. The realistic data has illustrated the importance of the private placement financing. Foreign scholars’research shows that as the popular means of financing of markets, private placement has been proven with a strong announcement effect in many countries. And domestic scholars’research shows that the announcement effect of private placement existed in China as well. But there are a lot of controversy about the influenced factors of private placement for China’s market. And previous domestic research is lack of more in-depth analysis of the private placement announcement of the specific company.The private placement can be divided into asset purchase, project financing, and this paper Studied to types of private placement above. Firstly, this paper studied private placement announcement effects of asset purchase and project financing with the event study methodology, which shows that overall, the two types of private placement have a positive announcement effect, but different ways of the private placement announcement effect has different degree. And the specific conclusions are as follows:1.In [-4,-1] time window, project financing of private placement has the largest cumulative excess rate of return, which is1.06%.2.In [-7,5] time window, asset purchase of private placement has the largest cumulative excess rate of return, which is12.59%. Secondly, From the company at the micro level, this paper extracted capital gains rate, whether controlling shareholders is included in the private placement of objects, whether the sale of assets and other variables is involved in the private placement from the company’s private placement plan announcement, using a logistic model approach to study the announcement effect of different ways, and concluded as follows:1.Capital gains rate of asset purchases has a better explanatory power with relatively high positive cumulative abnormal return.2. Whether controlling shareholders is included in the objects of private placement in project financing has a certain explanatory power with the cumulative abnormal return.