Private Placements Research Articles

Determining the Optimal Capital Structure of PT Bumi Resource Tbk

Demand for coal increased because of the energy crises that occurred in Europe and China. Due to this growth in demand, coal prices have gone up globally as well. This can be an opportunity for coal companies in Indonesia as one of the countries with the largest coal reserves in the world. PT Bumi Resource Tbk, one of the businesses with Indonesia’s largest coal deposits. Additionally, most of the coal supplied by PT Bumi Resource Tbk is consumed domestically, and most of it for China. So, it is necessary to increase production to meet these demands. One way to increase production is by optimizing the company’s capital structure. The proportion of debt and equity which is capital structure will be the focus of the company in the future. PT Bumi Resource Tbk was repeatedly unable to repay its loans. Based on calculations through the Damodaran theory, the optimal capital structure for companies in 2021 with 30 percent debt ratio. This would maximize the company’s value of $1,709,478,366 with a weight average cost of capital of 7.86 percent. Future projections are made using three scenarios: the best scenario, the base scenario, and the worst scenario. The best scenario is the best of these three scenarios with delivers the highest firm value, $ 4,605,803,420 with the lowest weight average of capital costs, 9,06 percent. The proportion of the debt ratio needed to maximize the value of the company in its best condition is 10 percent. The results of calculating the optimal capital structure today or in the future show that companies need to reduce the debt ratio if they want to maximize their firm value. In addition, the company is also facing threat of bankruptcy because the Alman Z-score is -0.13. There are several ways based on the Damodaran framework to reduce debt ratio. First, a company can do a debt for equity swap by converting its debt into equity or by doing a private placement. Second, companies can negotiate with lenders regarding the maturity of their debts or decrease of interest by making an agreement. Third, companies can sell their assets to pay off their debts.

The concept of private placement in Polish and American federal law: The comparative analysis

Private placement as an offering of securities or shares to a specific group of investors is eagerly chosen by company authorities due to low costs and uncomplicated formal requirements. The entry into force of Regulation 2017/1129 resulting in the amendment of the Public Offering Act has changed the definition of a public offering in Polish law, significantly expanding its scope. At the same time, transactions that were previously considered private placements have become public offerings under the new legal definition. In this article the author compares the solutions of the American federal law regarding private and public offerings to the Polish regulations. Moreover, he proves that American law has developed a clear distinction between public and private offerings, treating private offerings as a separate class of offerings, while Polish law treats private placements as a type of public offerings. The author also tries to create a definition of a private placement that is consistent with the new legal environment in Poland.

Evaluation of Merchant Banking and Financial Services using VIKOR Method

Commercial banking is a professional service offered by commercial banks to customers for adequate consideration to make payments for their financial needs. Commercial banks are banks that raise funds, provide financial advice and lend to large corporations. These banks are experts in international trade and are experts in dealing with large companies and industries. Commercial banking provides finance to multinational businesses and large commercial enterprises in the country, which helps in boosting the economic strength of the country. Commercial banks do not provide services to the general public; Their services are limited to commercial companies and large business enterprises. A merchant banker fa-cilitates the subscription of securities. A commercial banker plays an important role and undertakes many responsibilities such as private placement of securities, management of public issue of securities, stock broking, and international financial advisory services. A commercial bank is a type of financial institution that offers underwriting, credit services, financial advice services, and fundraising to high-net-worth individuals and large corporations (HWNIs). Commercial banks are transnational organizations with a focus on global trade and service delivery. The VIKOR (VIšekriterijumsko Kompro-misno Rangiranje) Optimal replacement Select method is used in Australia/New Zealand, Continental, Europe, UK, Japan, Singapore, United States. Alternative: Australia/New Zealand, Continental, Europe, UK, Japan, Singapore, United States. Evaluation parameters of Area of manufacturing: Number of Partners, Number of Partners Bank Years, Share of joint venture banks assets, Average ownership per partner. Results: Australiar/New Zealand is got the first rank whereas is the Singapore is having the Lowest rank.

Sukuk Linked Wakaf For MSME Develpoment

The existing Sharia investment products are incorrect; the other is a state sukuk product. Aside from receiving returns on state sukuk, investors can also contribute to the country's development. Because the development of sukuk products is channeled to the actual sector, particularly for MSME (Micro, Small Maedium Enterprise) actors, Islamic financial institutions must play a role in carrying out the process of developing and aiding MSMEs. If many state sukuk products were previously allocated for infrastructure development, there needs to be an allocation for economic recovery through MSMEs under the current situations. The goal of this research is to assess the growth of state sukuk and the form of sukuk product development through state CWLS for the development of MSMEs. This is a qualitative study that examines the state sukuk market and the MSME sector. Secondary data was used, including information from the Ministry of Finance's Directorate General of Financing and Risk Management (DJPPR). The data analysis technique employed is descriptive qualitative, which depicts the evolution of state sukuk from 2019 to 2020, as well as forms of innovation for state sukuk goods designed specifically for MSMEs recovering from the covid-19 outbreak. PBS Auction Sukuk, PBS Private Placement Sukuk, SNI, SPN-S, Rite Sukuk (SR), and Savings Sukuk (ST) grew by 40.80% from 2019 to 2020, according to the findings of this study. Sukuk auctions at PBS increased by 39.59 percent, PBS Private Placement Sukuk increased by 214.39 percent, SR increased by 72.93 percent, and SNI Sukuk increased by 26.86 percent. In the meantime, SNI Sukuk fell by -30.01 percent, and ST fell by -35.76 percent. Providing business capital through Nazhir with a profit-sharing scheme, business assistance schemes, and maximizing the types of Waqf sukuk distributed to the productive sector are all schemes that can be implemented in developing MSMEs through the CWLS sukuk.

Sukuk Linked Wakaf For MSME Develpoment

The existing Sharia investment products are incorrect; the other is a state sukuk product. Aside from receiving returns on state sukuk, investors can also contribute to the country's development. Because the development of sukuk products is channeled to the actual sector, particularly for MSME (Micro, Small Maedium Enterprise) actors, Islamic financial institutions must play a role in carrying out the process of developing and aiding MSMEs. If many state sukuk products were previously allocated for infrastructure development, there needs to be an allocation for economic recovery through MSMEs under the current situations. The goal of this research is to assess the growth of state sukuk and the form of sukuk product development through state CWLS for the development of MSMEs. This is a qualitative study that examines the state sukuk market and the MSME sector. Secondary data was used, including information from the Ministry of Finance's Directorate General of Financing and Risk Management (DJPPR). The data analysis technique employed is descriptive qualitative, which depicts the evolution of state sukuk from 2019 to 2020, as well as forms of innovation for state sukuk goods designed specifically for MSMEs recovering from the covid-19 outbreak. PBS Auction Sukuk, PBS Private Placement Sukuk, SNI, SPN-S, Rite Sukuk (SR), and Savings Sukuk (ST) grew by 40.80% from 2019 to 2020, according to the findings of this study. Sukuk auctions at PBS increased by 39.59 percent, PBS Private Placement Sukuk increased by 214.39 percent, SR increased by 72.93 percent, and SNI Sukuk increased by 26.86 percent. In the meantime, SNI Sukuk fell by -30.01 percent, and ST fell by -35.76 percent. Providing business capital through Nazhir with a profit-sharing scheme, business assistance schemes, and maximizing the types of Waqf sukuk distributed to the productive sector are all schemes that can be implemented in developing MSMEs through the CWLS sukuk.

Discounting Restricted Securities

AbstractWe examine the costs of trading restrictions by exploiting an SEC rule change eliminating an approximately 80-day restriction period in private placements for small issuers. Using a difference-in-differences specification, we find that the restriction is binding, as dollar volume increases 19 percentage points vis-à-vis proceeds, and costly, as offering discounts fall by 8 percentage points. Discounts fall more for issuers with higher information asymmetry or longer restriction periods. We account for endogenous responses to the rule change. Overall, our findings suggest that trading restrictions are costly and have large effects on firms’ cost of capital.

The choice of flotation methods: Evidence from Chinese seasoned equity offerings

Using a comprehensive sample of Chinese seasoned equity offerings, we compare three major equity flotation methods employed by listed firms in China: rights issues, public offerings, and private placements. The dominant flotation method changed significantly around 2005. We examine the valuation effects of the three methods before and after 2005 and identify the determinants affecting the choice of flotation method. Our results support the information asymmetry hypothesis in that firms with high levels of information asymmetry tend to choose private placements and avoid either public offerings or rights issues. Ownership structure does not seem to be a key factor in determining the selection of flotation method. Profitability requirements of refinancing prevent many listed firms from raising additional capital externally. The removal of profitability requirements for private placements in 2006 boosts the popularity of private placements and explains the shift from rights issues to private placements to some extent.

The Inhibitory Effect of the Deregulation Short-Sale on Private Equity Placement.

In countries with a high degree of equity concentration, such as China, the second type of agency problem is serious in which major shareholders of listed companies encroach on the interests of small and medium shareholders through private placement. As a financial transaction system, the short-selling mechanism has the function of external corporate governance. Therefore, this paper examines the impact of relaxing short-selling controls on companies’ private placements. Based on the quasi-natural experiment of China’s gradual relaxation of short-selling controls since 2010, a double-difference model (DID) test is constructed to find that relaxing short-selling controls reduces companies’ private placement tendency and amount, and this effect is mainly reflected in samples with a higher degree of equity checks and balances. Further analysis found that when the size of the company’s financing constraints is different, the impact of relaxing short-selling control on the company’s private placement tendency and amount is different; when the chairman and the general manager have two positions, relaxing short-selling control reduces the company’s private placement options, but it has a negative impact on the company’s private placement. There is no difference in the impact of the company’s private placement amount. It can be excluded that the relaxation of short-selling control suppresses the company’s placement through financing constraints and corporate governance mechanisms. Compared to a good information environment, when the company’s information environment is poor, relaxing short-selling controls reduces the company’s private placement tendency and amount. Significantly, it shows that the relaxation of short-selling control policy and supervision inhibits the company’s private placement through the information environment mechanism, and promotes the sustainable development of enterprises. It not only improves the literature in the field of short-selling mechanism affecting corporate behavior, but it also enriches the research on the transfer of benefits of private placement of companies.

Research on the effect of issuing convertible bonds from the perspective of ownership structure -- Evidence from Listed Companies in Shanghai and Shenzhen

Due to the rapid increase of enterprise scale, the traditional financing methods can no longer meet the needs of enterprises. As a financing method with both equity and debt, the flexibility of convertible bonds is favored by enterprises. Especially in 2017, China's supervision on the financing method of private placement of shares became stricter, and some companies chose convertible bonds for financing. This paper takes the ownership structure as the starting point, takes the listed companies in Shanghai and Shenzhen as the research object, and uses the regression analysis method to test the relationship between convertible bond financing, ownership structure and enterprise performance. It is found that convertible bond financing will reduce the performance level of enterprises, and the ownership concentration strengthens the negative relationship.

Empirical Research on Investor Behavior in Pre-Listing and Post-Listing Periods - A Comparative Analysis Between the Regulated Market and the MTF Aero Administered by the Bucharest Stock Exchange

Abstract Investor behavior around an initial public offering or private placement can make the difference between a successful investment or a potential loss. Through the present research, the correlation of investors’ behavior with the possible discount of the share granted in the case of initial offers was sought. The large number of companies listed on the Bucharest Stock Exchange in 2021(23) compared to 2020(3) denotes the fact that the SARS-COV2 virus was a certain catalyst of interest for investors and companies to enter the Romanian capital market. From another point of view, we observe a strong orientation of companies towards MTF AeRO. Out of the total of 26 analyzed companies, only 3 of them chose the regulated market for trading

Plastics recycler Encina gets funding

The plastics recycling technology developer Encina has secured $55 million in funding. Encina says the money will go toward commercializing its technology, which uses a catalytic process to transform mixed plastic waste into aromatic chemicals such as benzene, toluene, and xylene. The company aims to build plants in the US, Asia, and South America, each with a capacity to process 450,000 metric tons per year. The investment includes a $32 million private placement from IMM Investment Global and SW Recycle Fund.

Margaret Sanger, “The Unrecorded Battle” (1912)

Margaret Sanger, “The Unrecorded Battle” (1912)

The Role of Financial Reporting Quality in Private Placements

The Role of Financial Reporting Quality in Private Placements

Is There Racial Discrimination in Private Placements?

Is There Racial Discrimination in Private Placements?

Analysis Produk Keuangan Syariah Sukuk

The development of the financial industry continues increase people are increasingly interested in using Islamic financial products. The products offered are increasingly varied to meet the needs of the community. In addition to providing benefits, Islamic financial products can contribute widely to the development of the country, in this case, the Sukuk product. Legally, Sukuk or Islamic bonds, get the law first, when compared to Islamic banks. Sukuk has law number 19 of 2008 concerning State Sharia Securities (SBSN). The Sukuk instrument continues to grow and can provide benefits for investors and benefits for the country's development. The purpose of this study is to determine the development of state Sukuk products, and analysis of Islamic financial products. The method used is qualitative, with a literature study approach. The data sources used are secondary data, data that has been presented by certain institutions and then processed, and from other sources deemed relevant to the theme. The data collection technique used is literature study from several sources, both from books, journals, and others. The analytical technique used is descriptive qualitative, describes the development of Sukuk products in 2020 to 2021, and describes the analysis of the Sukuk ijarah products. The results of this study indicate that there are developments in state Sukuk in the 2019 to 2020 period, PBS Auction Sukuk, PBS Private Placement Sukuk, SNI, SPN-S, Rite Sukuk (SR), and Savings Sukuk (ST) grew by 40.80 percent. Auction PBS Sukuk grew by 39.59, PBS Private Placement Sukuk grew by 214.39%, SR grew by 72.93%, SNI Sukuk by 26.86 percent. Meanwhile, SNI Sukuk decreased by -30.01% and ST decreased by -35.76 percent. Analysis of Islamic sharia financial products, especially with the ijarah scheme. There is a sale and purchase transaction is considered engineered, then the resale of assets from the investor to the issuer such as a sale and purchase transaction is prohibited. Buying and selling of Sukuk assets which are then leased back and have a time limit and conditions on the object of sale and purchase, making the seller not have control over the asset. Then the sale and purchase can become a sale and purchase without the obligation to resell the product that has been purchased if the owner of the goods can return the money for the goods he sells.

Choice between rights issue and private placements of equity and the role of information asymmetry

PurposeThe objective of this paper is to investigate the role of information asymmetry in the equity selling mechanisms chosen by the firms from an important emerging market, India. Specifically, the authors look into the choice between the two most popular mechanisms of equity issues – rights issue and private placement of equity.Design/methodology/approachThis study introduces three analyst specific variables as proxies of information asymmetry as the conventional proxies are fraught with several disadvantages. First, the paper tests the choice between rights issue and private placement using a binary logistic model. In the second approach the authors use rights issue and segregate the private placements into preferential allotments and qualified institutional placements and test the impact of information asymmetry using a multinomial logistic regression.FindingsThe outcome of this empirical exercise shows that only those firms facing lesser information problems choose rights issue of equity. Private placements are chosen by firms facing higher information problems to circumvent information costs. The results remain invariant even after segregating the qualified institutional placements from private equity placement as the firms with information disadvantage choose to place equity privately.Originality/valueIn contrast to the conventional studies that focus on the debt-equity framework, the authors argue that the impact of information asymmetry is applicable even at disaggregated levels of equity selling mechanism.

Distress Resolution through New Block Formation: Implications for Ownership Concentration*

AbstractThis study examines distress resolution under concentrated equity ownership and concentrated bank debt. Using a large sample of Korean financially distressed firms, I find that distress resolution is more likely when private placements of new equities are accompanied by a change in control. Control transfers in which new blocks are created through equity capital injection contribute to operational efficiency and long‐term performance. These findings suggest that equity capital injection and monitoring by new blockholders are essential for distress resolution under poor investor protection, which further explains why concentrated ownership may persist under such an environment.

Pengaruh Program Cash Wakaf Link Sukuk (CWLS) di Badan Wakaf Indonesia Terhadap Kesejahteraan Masyarakat

This study uses a descriptive qualitative method. Data collection comes from interviews with parties who are tied to the management of Cash Waqf Linked Sukuk (CWLS), especially the SW001 series at the Indonesian Waqf Board (BWI) as well as collecting data and reviewing various written sources related to CWLS practices at BWI). The results of this study indicate that: First, the practice of managing the CWLS SW001 program which involves stakeholders, one of which is the Indonesian Waqf Board as the sole nazhir wherein the nazhir invests the cash waqf using a mudharabah contract to issue SBSN by the ministry of finance in a private placement so as to channel the use of investment returns in the form of discounts. and compensation for the construction of the Achmad Wardi Eye Hospital in Banten. The results are collected and placed in CWLS for the purpose of developing new waqf assets (renovation and purchase of medical equipment, community services such as free cataract surgery and procurement of ambulances. Second, the influence of CWLS SW001 on community welfare is the achievement of CLWS in the form of health services (retinal devices and glaucoma). ) at the Achmad Wardi Eye Hospital is very helpful for the people around Banten. Given the very high cost of health operations and the returns obtained through CWLS as a form of financial recovery during the COVID-19 pandemic, CWLS has a significant effect on the welfare of the community.

Response to: "Medical Student Perspectives on Their Role as Emerging Physicians During the COVID-19 Pandemic".

We present a Letter to the Editor in response to the article by Chinsky et al. titled “Medical Student Perspectives on Their Role as Emerging Physicians During the COVID-19 Pandemic.” The authors highlighted that a greater proportion of preclinical students felt more obligated to volunteer in the context of healthcare staff shortages, compared to clinical students. As final year medical students, we propose additional reasons based on our personal experiences that may contribute to clinical students feeling less inclined to volunteer during the pandemic. Specifically, we believe that the priorities of clinical students may affect their willingness to volunteer given the challenge of balancing private study and clinical placement. Furthermore, we believe that the psychological difficulties that often accompany clinical placement may affect clinical students’ views on volunteering. We also briefly outline solutions that may solve these issues. Ultimately, positive attitudes in students need to be sustained throughout the medical degree so that the future generation of doctors is better equipped to face a future crisis and beyond.

A study on the effect of joint supervision between auditors and sponsors: evidence from China

AbstractThis study examines the joint supervision of auditors and sponsors in a sample of private placements on the Shanghai and Shenzhen stock markets from 2006 to 2019. We observe variation in the inhibitory effect of earnings management and inefficient investment based on the combination of intermediaries with different reputations. We find that auditors exert a strong inhibitory effect on earnings management while sponsors are best positioned to suppress inefficient investment. Furthermore, this study enriches the existing supervisory literature and provides insights to further improve the relationship between auditors and sponsors in the context of China’s unique registration system.