Hsia Hua Sheng

Impact of Trade Credit on Firm Inventory Investment During Financial Crises: Evidence from Latin America

This paper studies whether trade credit is used as a substitute for bank credit in crisis periods in Latin America. The sample is composed of firms listed on the Argentine, Brazilian, and Mexican stock exchanges from 1994 to 2009. For the small firms, the substitution hypothesis was not rejected. However, this hypothesis was not confirmed homogeneously for all the firms during the crises. Unlike Brazilian and Argentine firms, Mexican firms use more cash reserves than trade credit. The big firms tend to use other financing sources. A pattern of trade credit use by sector has not yet been found.

Liquidez das debêntures no mercado brasileiro

Neste estudo, investigam-se empiricamente proxies de liquidez baseadas nas caracteristicas das debentures das empresas brasileiras, assim como a interacao entre as medidas de liquidez. Essa abordagem foi sugerida por Houweling, Mentink e Vorst (2004), visto que as medidas usuais de liquidez nao sao facilmente construidas para o mercado de corporate bonds (debentures). Foram coletadas 135 emissoes publicas e de suas respectivas transacoes ate 18 meses apos a emissao no periodo de janeiro de 1999 a junho de 2004. O metodo stepwise forward linear do minimo quadrado ordinario foi usado para encontrar as variaveis proxies de liquidez. Testes nao-parametrico e parametrico foram aplicados no estudo. Foram encontrados os seguintes resultados: o tamanho de emissao e determinados tipos de emissores sao proxies de liquidez; controlando os tipos de emissores, as debentures com maior tamanho de emissao sao as mais liquidas; a relacao entre idade e liquidez nao e clara; a diferenca entre precos maximos e minimos das transacoes nao e uma medida de liquidez apropriada.

Custos de transação: uma análise empírica da sua relação com investimento e investimento direto estrangeiro

As stated by the New Institutional Economics theory, transaction costs play a relevant role in economics and, according to the extent of such costs, agents make investment decisions. Actually, transaction costs may represent a disincentive to entrepreneurship. This work aims to verify whether transaction costs are related to investment rate and foreign direct investment rate (FDI) in different business environments. The results suggest that foreign investors do not have precise information about other countries as domestic investors do; as it is observed, only the relation between transaction costs and investment rate is significant. Furthermore, there is evidence that the business environments of BRIC countries are less developed when compared to business environments of other countries in the study.Submitted 15.09.2010. Approved 18.03.2011 Evaluated in double blind review Scientific Editor: Fernanda F. Perobelli AbSTRACT As stated by the New Institutional Economics theory, transaction costs play a relevant role in economics and, according to the extent of such costs, agents make investment decisions. Actually, transaction costs may represent a disincentive to entrepreneurship. This work aims to verify whether transaction costs are related to investment rate and foreign direct investment rate (FDI) in different business environments. The results suggest that foreign investors do not have precise information about other countries as domestic investors do; as it is observed, only the relation between transaction costs and investment rate is significant. Furthermore, there is evidence that the business environments of BRIC countries are less developed when compared to business environments of other countries in the study.

Desempenho de fusões e aquisições cross border: análise empírica do caso brasileiro

This study aims to investigate whether the cross-border acquisitions made by Brazilian companies over the past 15 years have improved their financial performance. Drawing on Institutional, Socio-cultural and Organizational Learning theories, this study develops and empirically tests several hypotheses on the determinants of M&A performance. The results demonstrate that the cross-border acquisitions of Brazilian companies improve their financial performance. Financial performance tends to be positive if the cultural distance between the countries of the acquiring and acquired companies is low to medium and if the institutional context in which the acquired company operates is developed. We also find that the relationship between the previous experience of acquiring companies in international M&As and the performance of a new cross-border operation follows an inverted U shape. These findings suggest that studies on international M&As should include the M&A experience of the acquiring firm as well as the institutional characteristics of its target countries.Adriana Bruscato Bortoluzzo, Maria Pia de Siqueira Garcia, Dirk Michael Boehe, Hsia Hua Sheng

EMBEDDED GOVERNANCE IN CORPORATE BOND INDENTURES: EVIDENCE FROM BRAZIL, 1998–2001

Corporate bonds have been a major source of medium and long-term financing in Brazil. We analyze how corporate bond covenants have been used to mitigate agency costs between shareholders and bondholders. Our data includes 119 corporate bond indentures issued in Brazil from 1998 to 2001. This paper analyzes whether public investors have demanded stricter terms in corporate bond indentures. When comparing to previous studies of Anderson (1999) and of Filgueira and Leal (2001), we found empirical evidence that: (a) more bond issues with no indexed inflation features, but more floating rate interest features to match market needs; (b) no major changes for contingent maturity features; (c) loose covenants with respect to dividend and financing actions; and (d) tighter covenants regarding change in control and/or ownership and negative pledge. There is empirical evidence that the role of sponsor may partially mitigate risks borne by bondholders.

Governança corporativa embutida nas escrituras de debêntures emitidas no Brasil

Corporate bonds have been one of the major sources of medium and long-term financing in Brazil. We analyze how corporate bond covenants have been used to mitigated agency costs between shareholders and bondholders. Our data includes 119 corporate bond indentures issued from 1998 to 2001 and 141 issued from 2002 to 2005 in Brazil. This paper analyzes whether public investors have demanded stricter terms in corporate bond indentures. When comparing to previous studies of Anderson (1999) and of Filgueira and Leal (2001), we found empirical evidence that: more bond issues with no indexed inflation features, but more floating rate interest features to match market needs; no major changes for contingent maturity features; loose covenants with respect to dividend and financing actions; and tighter covenants regarding change in control and/or ownership and negative pledge. There is empirical evidence that the role of sponsor may partially mitigate risks borne by bondholders.

Análise de métodos de replicação: o caso IBOVESPA

This article presents and implements the main numerical methods used to replicate the Bovespa Index. The implemented models were full replication, minimum global variance portfolio, Black model and square minimization with short selling. The results were verified under the parameters of tracking error, beta, R2 and serial similarity of average and variance. It was concluded that there is not the only way to achieve the best result, because all methods present strengths and weakness on the different contexts tested. In addition, managers may have different necessities on the time.

Performance in cross-border mergers and acquisitions: an empirical analysis of the brazilian case

This study aims to investigate whether the cross-border acquisitions made by Brazilian companies over the past 15 years have improved their financial performance. Drawing on Institutional, Socio-cultural and Organizational Learning theories, this study develops and empirically tests several hypotheses on the determinants of M&A performance. The results demonstrate that the cross-border acquisitions of Brazilian companies improve their financial performance. Financial performance tends to be positive if the cultural distance between the countries of the acquiring and acquired companies is low to medium and if the institutional context in which the acquired company operates is developed. We also find that the relationship between the previous experience of acquiring companies in international M&As and the performance of a new cross-border operation follows an inverted U shape. These findings suggest that studies on international M&As should include the M&A experience of the acquiring firm as well as the institutional characteristics of its target countries.Adriana Bruscato Bortoluzzo, Maria Pia de Siqueira Garcia, Dirk Michael Boehe, Hsia Hua Sheng

Desempeño de fusiones y adquisiciones cross border: análisis empírico del caso brasileño

This study aims to investigate whether the cross-border acquisitions made by Brazilian companies over the past 15 years have improved their financial performance. Drawing on Institutional, Socio-cultural and Organizational Learning theories, this study develops and empirically tests several hypotheses on the determinants of M&A performance. The results demonstrate that the cross-border acquisitions of Brazilian companies improve their financial performance. Financial performance tends to be positive if the cultural distance between the countries of the acquiring and acquired companies is low to medium and if the institutional context in which the acquired company operates is developed. We also find that the relationship between the previous experience of acquiring companies in international M&As and the performance of a new cross-border operation follows an inverted U shape. These findings suggest that studies on international M&As should include the M&A experience of the acquiring firm as well as the institutional characteristics of its target countries.Adriana Bruscato Bortoluzzo, Maria Pia de Siqueira Garcia, Dirk Michael Boehe, Hsia Hua Sheng

Importância do rating na padronização de debêntures

Standard bonds dispense investors of complex contractual analysis and sophisticated calculus in secondary markets transactions. This paper – based in non-standard bond contracts – investigates the effects of controlling statistically contractual differences: would the bond ratings be sufficient to capture interest rates’ costs of its issues? We take a sample of 24 bond issues in the period from 1999 to 2001 in order to verify if the difference in corporate bond covenants, when comparing issues with high rating and low rating, are statistically significant (binomial distribution). We conclude that, for high ratings, interest rate reflects standard features due to rating. For low ratings, standard features do not capture specific contractual difference, like established reinvestment and guarantee.