Share pledging for seasoned equity offerings? Evidence from China

We investigate an unexplored channel through which pledged loans are exploited by the most influential firm insiders in China. Specifically, we document a significant and positive relationship between net pledging by the largest shareholder before a seasoned equity offering and her cash subscription...

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Bibliographic Details
Published in:Applied economics letters 2023-05, Vol.30 (9), p.1244-1247
Main Authors: Liu, Desu, Fang, Ziqiao
Format: Article
Language:English
Subjects:
Economic analysis
Economic theory
Economics
largest shareholders
Loans
seasoned equity offering
Share pledging
Stockholders
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Summary:We investigate an unexplored channel through which pledged loans are exploited by the most influential firm insiders in China. Specifically, we document a significant and positive relationship between net pledging by the largest shareholder before a seasoned equity offering and her cash subscription to that very offering.
ISSN:1350-4851
1466-4291
DOI:10.1080/13504851.2022.2044008