dc.contributor.author | Saiti, Anthony M. | |
dc.date.accessioned | 2013-03-15T06:52:02Z | |
dc.date.issued | 2012 | |
dc.identifier.citation | Master in Business Administration | en |
dc.identifier.uri | http://erepository.uonbi.ac.ke:8080/xmlui/handle/123456789/13963 | |
dc.description.abstract | A rights offer refers to an equity issue where all existing shareholders of the issuing
company have right to sign up for new shares on a pro rata basis at a certain price and
within a certain time period. Although the share rights issue is a vital process in
financing of corporations, only few studies have investigated it. A company faces
different alternatives when it comes to issuing equity. However, the choice between
initial public offer, private placement or share rights issue remains a major problem as
there is no scientific procedure that has been established through empirical research.
The objective of this study was to determine the factors leading to choice of rights
issue as a mode of corporate finance in Kenya.
The study adopted explanatory research design with a population that consisted of the
14 firms listed in the NSE that have used rights issues between the year 2000 and
2011. This study used time series data exclusively obtained from NSE, CMA and
audited financial statements of the respective firms. The data collected was analyzed
using descriptive statistics, correlations, and linear regression analysis. This was
achieved through the use of Statistical Package for Social Scientists (SPSS) and
Microsoft Excel. Mul tivar iate regression analysis was utilised in fitting a regression
model that describes the relationship subsisting between the dependent variables and
independent variables From the research it was determined that the financial strength of a firm determines whether a firm has a rights issue or not. Post- rights issue ownership retention during this period impacted negatively rights issue contrary to the expectation whereas the age of the rights offer impacts positively the rights issue. It can be recommended from the study that besides this significant model explaining the variation in the rights issue, this research is informative because the findings are consistent with intriguing findings of limited prior research regarding the relevance of rights issue prospectus in guiding investors in making rational investment choice. The findings help clarify preceding empirical rights issue research regarding which factors determine rights
issue pricing. Securities exchange regulatory authorities need to review the disclosure
requirements for firms going public. | en |
dc.description.sponsorship | The University of Nairobi | en |
dc.language.iso | en | en |
dc.subject | Nairobi Securities Exchange | en |
dc.title | Factors determining rights issue for firms listed at the Nairobi Securities Exchange | en |
dc.type | Thesis | en |
local.publisher | School of Business | en |