회사재건 유형별 회사재건 시작시와 종료시의 시장반응

This paper investigates the stock market's response to the start and the completion of reorganization of financially distressed firms that restructure their debt by workout or legal procedures. This paper also investigates comparative advantage between workout and legal procedures in the reorganization of financially distressed firms by the stock market's response. Using event study methodology we examine the average abnormal returns and the cumulative average abnormal returns in the market adjusted returns model.Our empirical results are as follows.First, the cumulative average abnormal returns of firms in workout are significantly negative in the date of becoming workout object. And the cumulative average abnormal returns of firms in the law process are significantly negative in the date of applying for legal management. Therefore we conclude that the response of stock market to the announcement of reorganization is negative.Second, in the completion of debt reconstruction the cumulative average abnormal returns of firms in workout are insignificantly positive. And the results of the firms in the law process is analogous to the those of the firms in workout. Therefore we conclude that the market participants are incredulous about the possibility of those firms' revitalization. Third, the cumulative average abnormal returns of firms in workout is significantly positively different to those of firms in the law process in the start of reorganization. We conclude that the market participants prefer workout to legal process in terms of reorganization.