2015
DOI: 10.1016/j.jbankfin.2015.03.009
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Risk, illiquidity or marketability: What matters for the discounts on private equity placements?

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Cited by 14 publications
(4 citation statements)
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“…This is the special 'replacement function' of the clearing house. All these actions of the clearing house can be successfully realized because it has strong financial resources and has implemented a margin system, which is a set of strict debt-free financial operation system [42].…”
Section: Clearing Housementioning
confidence: 99%
“…This is the special 'replacement function' of the clearing house. All these actions of the clearing house can be successfully realized because it has strong financial resources and has implemented a margin system, which is a set of strict debt-free financial operation system [42].…”
Section: Clearing Housementioning
confidence: 99%
“…It reflects the relative size of the private placement deal, or the dilution level of the deal. As in L. H. Chen et al (), Discount is the discount rate of the issuing price compared to the market price of the firm one day before the issuance announcement. The standard auction theory (e.g., Cammack , p. 113) predicts a positive relation between the number of bidders and dispersion of opinion.…”
Section: Data and Variable Definitionsmentioning
confidence: 99%
“…The mean (median) discount rate of the issuing price is 16.678% (16.740%). A positive discount rate is typically driven by the illiquidity premium for a long lock‐up period, firm risk, and marketability (L. H. Chen et al ). The mean (median) quantity of issuing shares is 154,980,000 (53,640,000).…”
Section: Data and Variable Definitionsmentioning
confidence: 99%
“…It reflects the relative size of the private placement deal, or the dilution level of the deal. As in Chen et al (2015), discount is the discount rate of the issuing price compared to the market price of the firm one day before the issuance announcement. The fundamentals of the firm include firm size log(value), Tobin's Q, cash holding cash, f irmage, and book leverage lev.…”
Section: Variables Constructionmentioning
confidence: 99%