Convertible bond announcement effects: why is Japan different?

Marie Dutordoir, Hui Li, Frank Hong Liu, Patrick Verwijmeren

Research output: Contribution to journalArticlepeer-review


U.S. and Japanese firms dominate global convertible bond issuance. Previous research 10 documents more favorable convertible bond announcement effects in Japan than in the U.S. 11 and other developed countries. Using a global sample of convertible bonds issued from 1982 12 to 2012, we find that the more favorable announcement effects of Japanese convertibles are 13 driven by their stated uses of proceeds. Japanese convertibles more often include capital expen- 14 diture as an intended use, while U.S. firms tend to mention general purposes to motivate their 15 offering. Our findings illustrate the value to firms of being more explicit when disclosing the 16 intended use of proceeds of security offerings.
Original languageEnglish
Pages (from-to)76-92
JournalJournal of Corporate Finance
Publication statusPublished - 22 Dec 2015


  • Convertible bonds, Capital expenditure, Disclosure standards, Japan, Stated use of proceeds


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