IDEAS home Printed from https://ideas.repec.org/a/ids/intjaf/v6y2016i2p145-165.html
   My bibliography  Save this article

Wealth effects of private placements: evidence from Indonesia

Author

Listed:
  • Yane Chandera
  • Lukas Setia-Atmaja

Abstract

This study examines the wealth effects of private placements undertaken by Indonesian publicly listed firms. It also determines the factors that affect the wealth creation based on two underlying hypotheses: asymmetric information and monitoring hypotheses. All private placements data of Indonesian publicly listed firms from 1996 to 2013 are used in this study. Wealth effects are measured using an event study methodology while cross-sectional regression analyses with White's heteroskedasticity-corrected standard errors are conducted to evaluate the main determinants of the observed abnormal returns. This study finds that private placements create value to the issuing firms, and are generally induced by the mitigation of asymmetric information problems rather than by the increase of ownership concentration. Therefore, this study is able to prove asymmetric information hypothesis but fails to support the monitoring hypothesis. This result is consistent with similar studies on other Asian firms which generally have high ownership concentration.

Suggested Citation

  • Yane Chandera & Lukas Setia-Atmaja, 2016. "Wealth effects of private placements: evidence from Indonesia," International Journal of Accounting and Finance, Inderscience Enterprises Ltd, vol. 6(2), pages 145-165.
    • Handle: RePEc:ids:intjaf:v:6:y:2016:i:2:p:145-165
    as

    Download full text from publisher

    File URL: http://www.inderscience.com/link.php?id=79094
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ids:intjaf:v:6:y:2016:i:2:p:145-165. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sarah Parker (email available below). General contact details of provider: http://www.inderscience.com/browse/index.php?journalID=231 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.