We investigate the announcement returns and long run performance of SEOs conducted by public firms in four East Asia markets in the period from 2003 to 2015. The shareholder approval is required for equity issuance in our sample. The empirical results show that both the announcement and post-issue abnormal returns are significantly negative. Our findings contradict the evidences in Holderness (2018) that the announcement returns are significantly positive for SEOs when shareholders must vote to approve equity issuances. Our results of long-run underperformance also demonstrate that mandatory shareholder approval does not effectively mitigate the managerial agency problem associated with SEOs.
