Abstract:We examine the market reaction to firms that withdrew previously announced private investments in public equity (PIPE) in China and find significantly negative abnormal returns for the withdrawal announcement. We analyze the effect of withdrawal reasons, and find that compared to withdrawals due to unfavorable market conditions, the market reaction is more negative if the firms passively withdrew PIPEs due to the disapproval by the General Meeting of Shareholders or the Chinese Securities Regulatory Commission… Show more
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