SEC enforcement in the PIPE market: Actions and consequences
(2014) In Journal of Banking & Finance 42. p.213-231- Abstract
- In 2002, the SEC launched enforcement actions against investors involved in PIPE (Private Investments in Public Equity) transactions. We describe the legal ramifications of this enforcement initiative, and document dramatic contemporaneous market-wide changes in the contractual structure of PIPEs. PIPEs in the post-action period included fewer aggressive repricing rights and more trading restrictions. However, PIPEs in the post-action period also included more investor protections and fewer issuer rights. These results suggest that the SEC's enforcement enticed investors to substitute non-SEC-targeted contractual features for targeted ones. Our paper sheds new light on the role of legal enforcement on financial contract design. Published... (More)
- In 2002, the SEC launched enforcement actions against investors involved in PIPE (Private Investments in Public Equity) transactions. We describe the legal ramifications of this enforcement initiative, and document dramatic contemporaneous market-wide changes in the contractual structure of PIPEs. PIPEs in the post-action period included fewer aggressive repricing rights and more trading restrictions. However, PIPEs in the post-action period also included more investor protections and fewer issuer rights. These results suggest that the SEC's enforcement enticed investors to substitute non-SEC-targeted contractual features for targeted ones. Our paper sheds new light on the role of legal enforcement on financial contract design. Published by Elsevier B.V. (Less)
Please use this url to cite or link to this publication:
https://lup.lub.lu.se/record/4439503
- author
- Bengtsson, Ola LU ; Dai, Na and Henson, Clifford
- organization
- publishing date
- 2014
- type
- Contribution to journal
- publication status
- published
- subject
- keywords
- Private Investment in Public Equity (PIPE), Regulation, The SEC
- in
- Journal of Banking & Finance
- volume
- 42
- pages
- 213 - 231
- publisher
- Elsevier
- external identifiers
-
- wos:000334089100017
- scopus:84894676372
- ISSN
- 1872-6372
- DOI
- 10.1016/j.jbankfin.2014.02.002
- language
- English
- LU publication?
- yes
- id
- 3578bc09-30c6-44e5-b450-693f9f5bf284 (old id 4439503)
- date added to LUP
- 2016-04-01 09:49:43
- date last changed
- 2022-04-11 23:17:14
@article{3578bc09-30c6-44e5-b450-693f9f5bf284,
abstract = {{In 2002, the SEC launched enforcement actions against investors involved in PIPE (Private Investments in Public Equity) transactions. We describe the legal ramifications of this enforcement initiative, and document dramatic contemporaneous market-wide changes in the contractual structure of PIPEs. PIPEs in the post-action period included fewer aggressive repricing rights and more trading restrictions. However, PIPEs in the post-action period also included more investor protections and fewer issuer rights. These results suggest that the SEC's enforcement enticed investors to substitute non-SEC-targeted contractual features for targeted ones. Our paper sheds new light on the role of legal enforcement on financial contract design. Published by Elsevier B.V.}},
author = {{Bengtsson, Ola and Dai, Na and Henson, Clifford}},
issn = {{1872-6372}},
keywords = {{Private Investment in Public Equity (PIPE); Regulation; The SEC}},
language = {{eng}},
pages = {{213--231}},
publisher = {{Elsevier}},
series = {{Journal of Banking & Finance}},
title = {{SEC enforcement in the PIPE market: Actions and consequences}},
url = {{http://dx.doi.org/10.1016/j.jbankfin.2014.02.002}},
doi = {{10.1016/j.jbankfin.2014.02.002}},
volume = {{42}},
year = {{2014}},
}