Firm and Underwriter Reputations and the Pricing of Capital Raising ADRs and Restricted GDRs
Pre-offer attributes of firms that raise capital through privately traded Rule 144A and/or Regulation S Global Depositary Receipts (restricted GDRs) closely resemble pre-offer attributes of foreign firms that raise capital through NYSE-listed Level III American Depositary Receipts (ADRs). On average, both groups have higher Tobin’s q ratios, sales growth rates, sales levels, and returns on equity than do their respective home-market counterparts. Issuers of restricted GDRs also have higher average dividend payout ratios. Most ADR and GDR issues are underwritten by major investment banks with substantial reputations and the average discounts these banks attach to offerings of restricted GDRs are smaller than discounts associated with private equity offerings by US firms. GDR discounts are smaller for firms with stronger pre-offer performance reputations and for firms that use more reputable underwriters. These reputation benefits accrue to issuing firms even though these securities provide no legal bonding.
J. Michael Pinegar Ravi Ravichandran
Marriott School Brigham Young University Provo, Utah 84602 Graduate School of Business Loyola University Chicago 1 E Pearson Street Chicago, Illinois 60611
国际会议
成都
英文
1-42
2007-07-09（万方平台首次上网日期，不代表论文的发表时间）