Some new evidence on bond initial public offerings in the Taiwan Stock Exchange: An industrial perspective

This study examines the determinants of types of bonds at the initial public offerings (IPOs) for the Taiwan Stock Exchange (TWSE). From an industrial perspective, R&D expenditures are mainly positively related to issuing straight bonds and future growth opportunities to convertible bonds for el...

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Bibliographic Details
Published inPhysica A Vol. 378; no. 2; pp. 357 - 373
Main Authors Ke, Mei-Chu, Liang Liao, Tung, Hsu, Hong-Ming
Format Journal Article
LanguageEnglish
Published Elsevier B.V 15.05.2007
Subjects
Bond initial public offerings
Event study
Multinomial logit model
Bond initial public offerings
Event study
Multinomial logit model
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Summary:This study examines the determinants of types of bonds at the initial public offerings (IPOs) for the Taiwan Stock Exchange (TWSE). From an industrial perspective, R&D expenditures are mainly positively related to issuing straight bonds and future growth opportunities to convertible bonds for electronic firms. In the non-electronic industry, firms with significant financing needs are more likely to issue convertible bonds, whereas those without such requirement are more likely to issue straight bonds. It is also found that electronic firms convey a significant negative signal to the stock market, while non-electronic firms experience an insignificant stock price response surrounding the announcements of the bond IPO.
ISSN:0378-4371
1873-2119
DOI:10.1016/j.physa.2006.12.007