Private placements, cash dividends and interests transfer: Empirical evidence from Chinese listed firms

In this paper, the relationship between private placements of common stocks and cash dividends for Chinese listed firms is investigated. It finds that Chinese listed firms pay more cash dividends after private placements than do those that are not involved in placements. Firms with large shareholders participating in private placements pay more cash dividends than those without large shareholder participation. These results indicate that the firms controlled by large shareholders have a high propensity for interests transfer in their cash dividend policies.