Why Issue Equity Abroad? Corporate Reasons and Stock Market Responses

The increased use of equity issues on both domestic and foreign capital markets from the early 1980s raises the research question addressed in this article: What are the significant reasons for raising capital abroad as compared to at home? And, to what extent have these reasons vanished with deregulation? Based on an event study, the share price response on the Swedish stock market to the announcement of equity issues on foreign stock markets by Swedish companies are analyzed, and compared, for pre- and post-deregulated periods, with respect to differences in the ways the issues were prepared and announced.