Navigating Policy Uncertainty: PIPEs and SEOs in Equity Financing
About this Event
Join the Sentry School of Business and Economics at UW-Stevens Point for a brown bag lunch and learn event about "Navigating Policy Uncertainty: PIPEs and SEOs in Equity Financing" featuring Siyuan Fan and Deborah Beyer on Friday, Nov. 13 at 12-1:30 p.m. in the CPS 329. Boxed lunch and beverage will be included.
Abstract: Using a sample of 2,991 private investments in public equity (PIPEs) and 6,977 seasoned equity offerings (SEOs) from 2001 to 2019, we examine how economic policy uncertainty (EPU) impacts firms’ choices between these two equity financing mechanisms. We find that firms are more likely to issue PIPEs rather than SEOs during periods of heightened EPU. As EPU increases, SEO discounts increase, whereas PIPE discounts decrease and PIPE announcement wealth effects become more positive. Our results suggest that PIPEs mitigate uncertainty-related adverse selection and, during periods of heightened policy uncertainty, signal issuer undervaluation and superior deal quality.
RSVP by Nov. 11 at noon to secure your spot.
Funding for this brown bag lunch is provided by the UWSP Center for Data Analytics.
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