Shareholders as Creditors of First Resort

• 成果类型: Article
• 署名作者: Bodnaruk, Andriy; Rossi, Marco
• 署名单位: University of Illinois System; University of Illinois Chicago; University of Illinois Chicago Hospital; Texas A&M University System; Texas A&M University College Station; Mays Business School
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2019.3556
• 发表日期: 2021
• 关键词: Dual holders; SHAREHOLDERS; BONDHOLDERS; bond initial public offerings (IPOs)

摘要

We show that a firm?s ability to access the public bond market for the first time is greatly improved when habitual dual holders (HDHs)-financial conglomerates that tend to simultaneously hold both equity and bonds of their portfolio firms-are among its shareholders. HDHs are more likely to buy bonds in a bond initial public offering (IPO) and to take larger bond positions than bond investors with no equity in the firm. Greater equity ownership by HDHs is associated with a higher fraction of the issue ending up in the hands of pre-IPO shareholders, lower offering yield spreads, and more covenants overall but fewer covenants that restrict payout to shareholders.