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- Title
Rights Issues in the Chinese Stock Market: Evidence of Earnings Management.
- Authors
Fung, Hung-Gay; Leung, Wai K.; Zhu, Jiang
- Abstract
Using 665 rights offerings of Chinese firms, we demonstrate positive but diminishing price effects of successive announcements at the board meeting, the shareholders' meeting, the prospectus release date, and the ex-rights date, but negative abnormal returns before the ex-rights date. Public investors value the participation from shareholders of state and legal-person shares in the rights offerings, which seem to be linked to the future firm performance. The results overall supports the hypothesis that Chinese company earnings are considerably manipulated in the rights issue process.
- Subjects
PRICES; INVESTORS; RIGHTS offerings; BOARDS of directors; STOCKHOLDERS; CAPITAL
- Publication
Journal of International Financial Management & Accounting, 2008, Vol 19, Issue 2, p133
- ISSN
0954-1314
- Publication type
Article
- DOI
10.1111/j.1467-646X.2008.01019.x