Hostname: page-component-78c5997874-xbtfd Total loading time: 0 Render date: 2024-11-09T15:31:52.781Z Has data issue: false hasContentIssue false
  • English
  • Français

Competitive Bidding in the Underwriting of Public Utility Securities

Published online by Cambridge University Press:  06 April 2009

George G. C. Parker  and
Daniel Cooperman
Get access Rights & Permissions [Opens in a new window]

Extract

The competitive bidding requirement in the underwriting of public utility securities has come under increasing scrutiny in recent years. The difficulties that utilities have encountered in raising funds at an historically reasonable cost have exacerbated this situation. “Utilities,” as used here, will refer to investor-owned gas and electric public utilities. The combination of reduced capital availability and rapidly expanding financial needs gives rise to a serious inquiry about whether competitive bidding in new utility underwritings can be justified on the basis of cost to the company.

Type
Research Article
Information
Journal of Financial and Quantitative Analysis , Volume 13 , Issue 5 , December 1978 , pp. 885 - 902
Copyright
Copyright © School of Business Administration, University of Washington 1978

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

REFERENCES

[1]Carosso, Vincent P.Investment Banking in America. Cambridge, Mass.: Harvard University Press (1970).Google Scholar
[2]Cohan, Avery B.Cost of Flotation of Long-Term Corporate Debt since 1935. Chapel Hill: University of North Carolina (1961).Google Scholar
[3]Cohan, Avery B. “Yields on New Underwritten Corporate Bonds, 1935–48.” Journal of Finance, Vol. 17 (12 1962), pp. 585–605.Google Scholar
[4]Conrad, Joseph W., and Frankena, Mark W.. “The Yield Spread between New and Seasoned Corporate Bonds, 1952–63.” In Essays in Interest Rates, edited by Guttentag, J. M. and Cagan, P., Vol. 1. New York: National Bureau of Economic Research (1969).Google Scholar
[5]Ederington, Louis H. “Uncertainty, Competition, and Costs in the Underwriting of Corporate Bonds.” Journal of Financial Economics, Vol. 1 (03 1975).Google Scholar
[6]Ederington, Louis H. “The Yield Spread on New Issues of Corporate Bonds.” Journal of Finance, Vol. 29 (12 1974), pp. 1531–1543.CrossRefGoogle Scholar
[7]Ederington, Louis H. “Negotiated versus Competitive Underwritings of Corporate Bonds.” Journal of Finance (12 1975).Google Scholar
[8]Fair, Ray Co., and Malkeel, Burton G.. “The Determination of Yield Differential between Debt Instruments of the Same Maturity.” Journal of Money, Credit, and Banking (11 1971), pp. 733–49.Google Scholar
[9]Frankena, Mark W. “The Influence of Call Provisions and Coupon Rate on the Yields of Corporate Bonds.” Essays on Interest Rates, ed. Guttentag, J. and Cagan, P., Vol. 2. New York: National Bureau of Economic Research (1971).Google Scholar
[10]Friend, Irwin et al. Investment Banking and the New Issue Market. New York: World Publishing Company (1967).Google Scholar
[11]Hayes, Samuel L. “Investment Banking: Power Structure in Flex.” Harvard Business Review (03–04 1971), pp. 136–52.Google Scholar
[12]Kessel, Ruben. “A Study of the Effects of Competition in the Tax-exempt Bond Market.” Journal of Political Economy, Vol. 79 (07–08 1971), pp. 706–37.CrossRefGoogle Scholar
[13]Logue, D., and Lindvall, J.. “The Behavior of Investment Bankers: An Econometric Investigation.” Journal of Finance, Vol. 29 (03 1974).Google Scholar
[14]Mendelson, Morris. “Underwriting Compensation.” In Investment Banking and the New Issue Market, edited by Friend, I. et al. New York: World Book (1967).Google Scholar
[15]Mendelson, Morris “Determinants of Underwriters' Spreads on Tax-exempt Bond Issues: Comment.” Journal of Financial and Quantitative Analysis, Vol. 3 (06 1968), pp. 215–24.Google Scholar
[16]Robertson, Wyndham. “The Underwriters Have to Offer Even More.” Fortune (01 1973), pp. 116–32.Google Scholar
[17]Tallman, Gary D.; Rush, David F.; and Melicher, Ronald W.. “Competitive vs. Negotiated Underwriting Costs for Regulated Industries.” Financial Management (Summer 1974), pp. 49–56,CrossRefGoogle Scholar
[18]Tanner, J. Ernest. “The Determinants of Interest Cost on New Municipal Bonds: a Revaluation.” Journal of Business, Vol. 48, No. 1 (01 1975), pp. 74–81.CrossRefGoogle Scholar
[19]Vinson, C. E. “Pricing Practices in the Primary Convertible Bond Market.” Quarterly Review of Economics and Business (Summer 1970), pp. 47–60.Google Scholar
[20]West, R. “Determinants of Underwriters' Spreads on Tax Exempt Bond Issues.” Journal of Financial and Quantitative Analysis (09 1967).Google Scholar
[21]West, R. “New Issue Concessions on Municipal Bonds: A Case of Monopsony pricing.” Journal of Business, vol. 38 (04 1965), pp. 135–148.CrossRefGoogle Scholar