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Institutional investors' holdings surrounding equity rights offerings
Gotland University, School of the Humanities and Social Science.
Haworth College of Business, Western Michigan University, Kalamazoo, MI, USA.
KTH Royal Institute of Technology, SE-100 44 Stockholm, Sweden.
2012 (English)In: Global Finance Journal, ISSN 1044-0283, E-ISSN 1873-5665, Vol. 23, no 2, 125-140 p.Article in journal (Refereed) Published
Abstract [en]

We examine shareholding surrounding Swedish rights offerings using detailed information on the ownership in firms. We analyze shareholding levels and their changes for domestic and foreign institutional investors. As institutional holdings change, domestic institutions increase their holdings more than foreign institutions. Our examination of low and high buying activities by institutional investors surrounding rights offerings shows no stock picking ability, thus not supporting the “smart-money hypothesis” (Gibson et al., 2004). We also find that investor domicile influences firm value following the offering. Overall, foreign investors exhibit a strong and opposite directional reaction to adverse selection costs than domestic investors.

Place, publisher, year, edition, pages
2012. Vol. 23, no 2, 125-140 p.
Keyword [en]
Equity offerings, Rights offerings, Institutional ownership, Domiciles
National Category
Economics and Business
URN: urn:nbn:se:hgo:diva-1639DOI: 10.1016/j.gfj.2012.06.002OAI: oai:DiVA.org:hgo-1639DiVA: diva2:575745
Available from: 2012-12-11 Created: 2012-12-11 Last updated: 2016-08-17

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ReferencesLink to record
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