Firms’ Choice of Seasoned Equity Issuance Method—Taking Private or Non-private Route

Abstract

The choice of an issuance method for selling subsequent equity is indeed an important corporate financial decision. The recent popularity of private placements over traditional seasoned equity offering (SEO) methods motivates this review on the determinants of firms' choice between 'private' and 'non-private' routes for follow-on equity financing. Empirical results are generally consistent with the theoretical propositions. The review suggests further empirical evidence and importance of dynamic models to extensively explain the choice of an equity floatation method by listed companies.

Indications of Creeping Acquisition through Rights Issues in Indonesian Non Financial Companies during 2018-2021

“…Acquisitions are usually competitive with time, often exacerbated by competitive bidding situations, which force the acquirer to make decisions on the basis of limited information and can create biases in decision making (Company, 2013). Through reviewed regulations, rights issue is a way many firms use through placing in preference to get equity (Tuli, 2016). The rights issue itself is intended by the company to obtain additional capital that is used to develop the company's business so that investors will perceive the company as having a promising value in the future (Rohit et al, 2016).…”