Market reaction to unsweetened and sweetened rights offerings in an emerging European stock market

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dc.contributor.authorAdaoglu, Cahit
dc.date.accessioned2026-02-06T18:40:11Z
dc.date.issued2006
dc.departmentDoğu Akdeniz Üniversitesi
dc.description.abstractThis research investigates the market reaction to both unsweetened (plain) and sweetened (with simultaneous distribution of bonus issues) rights offerings in the Istanbul Stock Exchange. Consistent with previous U.K. and U.S. evidence, although with larger magnitude, the announcement day abnormal returns for unsweetened rights offerings are negative and significant, suggesting that such issues convey unfavorable information about the future operating performance, investment opportunities, liquidity and dividend policy. In contrast, for sweetened rights offerings, the abnormal returns are positive. The empirical results do not provide evidence for the enhanced trading liquidity effect (the sweetener split effect) and for the overvaluation signaling effect. (C) 2005 Elsevier B. V. All rights reserved.
dc.description.sponsorshipIstanbul Sock Exchang
dc.description.sponsorshipI am grateful to an anonymous referee and Prof. Mezaine Lasfer (Cass Business School, City University) for many comments that have contributed to the improvement of this paper. Comments received from the participants at the 11th European Financial Management Annual Conference and at the 5th ERC/METU International Conference in Economics are kindly acknowledged. Financial award support of the Istanbul Sock Exchange contributed to the completion of this paper.
dc.identifier.doi10.1016/j.mulfin.2005.07.001
dc.identifier.endpage268
dc.identifier.issn1042-444X
dc.identifier.issn1873-1309
dc.identifier.issue3
dc.identifier.orcid0000-0001-5771-9997
dc.identifier.scopus2-s2.0-33748671605
dc.identifier.scopusqualityQ1
dc.identifier.startpage249
dc.identifier.urihttps://doi.org/10.1016/j.mulfin.2005.07.001
dc.identifier.urihttps://hdl.handle.net/11129/13174
dc.identifier.volume16
dc.identifier.wosWOS:000213898500003
dc.identifier.wosqualityQ1
dc.indekslendigikaynakWeb of Science
dc.indekslendigikaynakScopus
dc.language.isoen
dc.publisherElsevier Science Bv
dc.relation.ispartofJournal of Multinational Financial Management
dc.relation.publicationcategoryMakale - Uluslararası Hakemli Dergi - Kurum Öğretim Elemanı
dc.rightsinfo:eu-repo/semantics/closedAccess
dc.snmzKA_WoS_20260204
dc.subjectRights offerings
dc.subjectSignaling
dc.subjectLiquidity
dc.titleMarket reaction to unsweetened and sweetened rights offerings in an emerging European stock market
dc.typeArticle

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