2026-09-21T08:40:31Zhttps://dspace.mit.edu/server/oai/requestoai:dspace.mit.edu:1721.1/423322022-01-13T07:54:52Zcom_1721.1_7582com_1721.1_7581col_1721.1_131022
S.P. Kothari.
Koshal, Amit
Sloan School of Management.
Sloan School of Management
2008-09-03T15:21:57Z
2008-09-03T15:21:57Z
2007
2007
http://hdl.handle.net/1721.1/42332
232679033
Thesis (Ph. D.)--Massachusetts Institute of Technology, Sloan School of Management, 2007.
Includes bibliographical references (leaves 44-49).
PIPEs (Private Investments in Public Equity) are unique in that they are negotiated privately between sophisticated investors and the public firm. As a result, the issue price deviates from the firm's stock price, often resulting in a substantial PIPE discount. However, only a limited set of firms issues equity at such a discount. PIPE issuers tend to be low quality, less transparent firms that cannot raise capital through traditional sources. As indicators of this quality, I examine the firm's accruals and audit quality in the year of its PIPE issuance. I find that the PIPE discount is more strongly associated with audit quality, and that firms with low quality auditors are issued at a 5% discount relative to comparable firms with high quality auditors. Much of this discount is due to self-selection, suggesting that higher quality PIPE issuers select high quality auditors.
by Amit Koshal.
Ph.D.
59 leaves
eng
Massachusetts Institute of Technology
M.I.T. theses are protected by
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http://dspace.mit.edu/handle/1721.1/7582
Sloan School of Management.
Information and self-selection in the PIPE market
Thesis
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