Financial Management articles from March 1997

Financial Management archives from March 1997

The market value of debt, market versus book value of debt, and returns of assets. (includes appendices)
March 22, 1997... Empirical research typically relies on book rather than market value of debt, though theory is virtually always in terms of market values. This paper documents how book value measurements of debt distort debt-equity ratios and cost of capital...

To call or not to call convertible debt.
March 22, 1997... Empirical studies of conversion-forcing calls of convertible bonds have repeatedly documented two facts. One, in contradiction of Ingersoll's (1977a) and Brennan and Schwartz's (1977) assertion that in perfect markets firms should call as soon as...

Wealth effects of corporate debt issues: the impact of issuer motivations.
March 22, 1997... In spite of strong reasons for expecting that new issues of debt would affect the prices of a firm's outstanding securities, empirical research has provided weak and conflicting evidence of such effects. This paper reexamines this subject by...

Control versus firm value: the impact of restrictions on foreign share ownership.
March 22, 1997... Various developed economies such as Switzerland, Finland, Sweden, and Norway have imposed foreign-ownership restrictions on the stocks of companies based there. The developing Asian economies such as Singapore, Malaysia, Thailand, Indonesia,...

On the motivation for paying scrip dividends.
March 22, 1997... This paper investigates why some companies favor paying dividends in the form of shares rather than cash. By comparing firms that pay scrip dividends to firms that do not, I test the hypotheses that scrip dividends are motivated by tax savings,...