文档介绍：Managing Internal Equity and SEO
11/10/2017
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薛爽
Chapter Objective
The equity management perspective
Internal capital market theory
SEO influence and arrangement
SEO methods and Paradox of rights offer
Mkt effect of SEO announcement
New issues puzzle: long-term performance of SEO
Some interesting researches on Chinese SEO
discussions
11/10/2017
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中国最大的资料库下载
The equity management perspective
Principal-agency problem: management private benefits such as perks or slack off
Solutions:
--dividends or stock repurchases
--monitoring: collude between auditor and manager such as Enron and Arthur Anderson
--pensation
All solutions are imperfect
11/10/2017
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中国最大的资料库下载
Internal capital MKT theory
The traditional capital budgeting paradigm
--if a project should invest:
positive NPV rule
--what to do when facing budgeting limitation:
select the set offering the highest Total NPV
Limitations of traditional paradigm
--why is capital budget limited?
--who and how is the forecast of PV made?
--what are the roles of headquarters and division managers
11/10/2017
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中国最大的资料库下载
Internal capital MKT (ICM) theory
The advantages of ICM
-avoid the infor. asymmetry
-increased monitoring incentives
-better asset redeployability
Pecking order theory
Internal capital
New issue of equity
debt
11/10/2017
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中国最大的资料库下载
Internal capital MKT (ICM) theory --pecking order theory
Smith CO.
Jones CO.
True value could be higher,say
$120
$120
Best current estimate
100
100
True value could be lower,say
80
80
Now panies need new fund to invest.
Smith’s financial manager think: sell stock for $100 per share? It’s worth at least $120. A stock issue now would hand a free gift to new investors.
Jones’s manager with a different mood: export mkts are OK for now,but how are we foing pete with those new Siberian ranches? Fortunately the stock price has held up pretty well-we’ve had some good short-run news for the press and analysts. Now’s the time to issue stock!
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