Impact of Sarbanes-Oxley Act on Seasoned Equity Offerings by Canadian Cross-Listed Firms: Evidence from Bought Deals vs. Firm Commitment

Atturo Rubalcava

The International Journal of Business and Finance Research, 2015, vol. 9, issue 1, 63-71

Abstract: This paper examines the impact of the Sarbanes-Oxley Act on the market reaction and underwriting fees of two methods of choice for underwriting seasoned equity offerings: Bought deals and firm commitment, by Canadian firms cross-listed on major U.S. exchanges. After controlling for offer and firm characteristics, it finds the market reaction to offer announcements is more positive for bought deals than for firm commitment during the pre-Sarbanes period only. This shows that bought deals lost their indirect cost advantage after the passage of the Act. On the other hand, the underwriting fees are lower for bought deals than for firm commitment during the pre-Sarbanes period only. This shows that bought deals also lost their fees cost advantage after the passage of the Act.

Keywords: Sarbanes-Oxley Act; Seasoned Equity Offerings; Cross-Listed; Market Reaction; Underwriting Fees; Bought Deals; Firm Commitment (search for similar items in EconPapers)
JEL-codes: G24 G32 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.theibfr2.com/RePEc/ibf/ijbfre/ijbfr-v9n1-2015/IJBFR-V9N1-2015-5.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ibf:ijbfre:v:9:y:2015:i:1:p:63-71

Access Statistics for this article

The International Journal of Business and Finance Research is currently edited by Terrance Jalbert

More articles in The International Journal of Business and Finance Research from The Institute for Business and Finance Research
Bibliographic data for series maintained by Mercedes Jalbert ( this e-mail address is bad, please contact ).