Institutional investors and opportunistic seasoned equity offerings in the Korean stock market

摘要

This study examines the impact of institutional monitoring on opportunistic seasoned equity offerings (SEOs) in the Korean stock market. With a firm's accrual quality as a measurement for the degree of information asymmetry between managers and investors, we hypothesize that the managers of firms with poor accrual quality are likely to engage in opportunistic SEOs, but such opportunistic activity is weak in firms strongly monitored by institutional investors. The empirical findings indicate that opportunistic SEOs tend to be deterred by institutional monitoring.