This study offers evidence concerning the announcement effect of equity private placements by examining the stock
market reaction to the announcements made by Malaysian firms for the period 1999 to 2007.This study is motivated
by empirical findings that unlike public placements, private placements are associated with positive announcement
effect.Two prominent hypotheses used to explain the positive market responses are information and monitoring
hypotheses.However, inconsistent with previous studies, we
find zero announcement effect for Malaysian market.The result suggests that equity private placement in Malaysia does not convey positive signal as it does in other
countries
