Managerial Placement and Entrenchment

Tao, Qizhi; Zhao, Zhao; Zhang, Mingming; Xiang, Xueman

doi:10.1080/1540496x.2018.1474739

Cited by 3 publications

(4 citation statements)

References 24 publications

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“…Since the emergence of private placement in 2006, it has become the dominant financing method (J. Wu 2016;Tao et al 2018;Zhang et al 2021).…”

Section: The Rise Of Private Placement In Chinamentioning

confidence: 99%

“…The company may use private placement for strategic goals, including asset injection for industrial integration, raising funds for acquisitions, issuing additional equities for high-quality assets to facilitate parent company listing, introducing strategic investors for enhanced external governance, and minimizing stock price impact due to lock-in periods (Yu et al 2016;Zhang and Guo 2009;Xu 2011;Yi et al 2006;Zhou 2016). Compared with other refinancing methods, private placement has the advantages of low issuance cost (Xu 2011), flexible pricing mechanism (Tao et al 2018;W. Zhang 2008), diversified subscription methods (Xu 2011), the premium of the parent company's assets value through private placement implemented by a subsidiary (Yi et al 2006), and ease of approval (W. Zhang 2008;Zhou 2016).…”

Section: Regulations Of Chinamentioning

confidence: 99%

“…Substantial discounts are also observed in other markets (Xu et al (2017) found 7% in Australia; Kato and Schallheim (1993) discovered 11% in Japan). In China, Tao et al (2018) reported the average discount was 32.88% on managerial placements and 20.784% on non-managerial placements, whereas Zhang and Guo (2009) ascertained the block is even sold at a discount of 60.7% when all new equity is sold to the controlling shareholder. On the other hand, there are few markets sold at a premium.…”

Section: Discountmentioning

confidence: 99%

“…Barclay et al (2007) Managerial placement is consistent with the entrenchment hypothesis but not the certification hypothesis. Tao et al (2018) Tunnelling Hypothesis…”

Section: Monitoring Hypothesismentioning

confidence: 99%

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Private Placement of China-Listed Real Estate Firms: A Conceptual Idea

Ning,

Jalil

2023

JRFM

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This article conducts a review of the literature on private placement and analyzes the risks facing China’s real estate companies. It argues that, within the framework of China’s hybrid economic model, private placement can serve as a market-oriented financing mechanism and risk mitigation strategy beyond the traditional banking system. The article focuses on the characteristics of private placement, prevalent hypotheses, and influencing factors. It also traces the evolution of financialization in the global real estate industry, outlines the development model of China’s real estate sector, and discusses the challenges and risks it encounters. Private placement offers various advantages, including reducing corporate leverage, strengthening working capital, and addressing information asymmetry issues. However, existing research in this field is still insufficient. Therefore, future research can provide a more robust theoretical foundation and guidance for policymakers, investors, and businesses.

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“…Since the emergence of private placement in 2006, it has become the dominant financing method (J. Wu 2016;Tao et al 2018;Zhang et al 2021).…”

Section: The Rise Of Private Placement In Chinamentioning

confidence: 99%

Section: Regulations Of Chinamentioning

confidence: 99%

Section: Discountmentioning

confidence: 99%

“…Barclay et al (2007) Managerial placement is consistent with the entrenchment hypothesis but not the certification hypothesis. Tao et al (2018) Tunnelling Hypothesis…”

Section: Monitoring Hypothesismentioning

confidence: 99%

See 2 more Smart Citations