How do Firms Issue Shares? Evidence from around the World

This study provides a comprehensive analysis of how seasoned shares are issued in 47 different countries over a nineteen-year period. We study the relative magnitudes and frequencies of stock-financed mergers, rights offering, private placements, and public offerings, which we define as all seasoned share offerings that do not fall into one of our first three categories. Mergers are the most frequent type of offering in the U.S., while public offerings are the most frequent type of non-U.S. issuance, exceeding both rights offerings and private placements. Across countries strong investor protection laws are expected to be associated with higher levels of stock-financed mergers and public offerings, and lower levels of rights offerings and private placements. The findings will suggest that investor protection laws promote some types of issuance, but retard others.