Journal of Financial Economics Vol. 31 No. 2 1992
Underwriting calls of convertible securities
Abstract
Average common stock price responses to convertible preferred stock calls are significantly negative only when firms employ underwriters to assure conversion. Previous work reports similar results for convertible bond calls; we find that the stock price reaction does not depend upon the type of convertible security being called. The results support the idea that managers are more likely to have calls underwritten the more unfavorable their private information about firm value.
- DOI
- 10.1016/0304-405x(92)90006-j
- Volume
- 31
- Issue
- 2
- Pages
- 269-278
- Language
- en
- Sources
- bibtex:phds-export.bib openalex crossref