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1
Khurshed, Arif. "Initial public offerings : an analysis of the post-IPO performance of the UK firms." Thesis, University of Reading, 1999. http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.297620.
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Black, Janine Noelle. "RAMIFICATIONS OF SARBANES-OXLEY CORPORATE GOVERNANCE LEGISLATION ON INITIAL PUBLIC OFFERINGS OF RESEARCH-INTENSIVE FIRMS." Diss., Temple University Libraries, 2013. http://cdm16002.contentdm.oclc.org/cdm/ref/collection/p245801coll10/id/216518.
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Business Administration/Strategic ManagementPh.D.
The Sarbanes-Oxley (SOX) Act of July 2002 was created to address the financial malfeasance revealed during the investigations of several large firms by the Securities and Exchange Commission (SEC). The Act required public companies traded on U.S. exchanges to provide increased transparency in financial statements. Key portions of the legislation required firms to create internal financial controls and placed personal accountability with top executives. SOX mandated and standardized a greater degree of self-regulation. In the years following SOX, firms experienced significantly higher compliance costs, but they also benefited from the reduction of statement errors and fraud, increased accuracy in reporting, and greater investor confidence. After the Sarbanes-Oxley (SOX) Act of 2002, anecdotal evidence suggested that SOX impeded small, research intensive firms. We looked at research intensive firms going public before and after SOX to determine if there was a change in volume and quality of research intensive firms post-SOX. We found that firms that went public after SOX were fewer and had lower patenting activity. In the case of small and medium size firms, the cost of SOX compliance is likely to divert funds from research investments. We speculate that highly research intensive firms are more likely post-SOX to divert their IPO to non-U.S. exchanges, delay going public, or dismiss the idea of going public, as proposed in a “3Ds” model. The 2002 SOX US Congressional Act levied millions of dollars in new compliance costs on each foreign or domestic firm that went public on U.S. exchanges. Funding for regulatory expenditures must come from somewhere. We proposed that one likely candidate was research budgets, as research efforts have a more distant, less immediately visible, long term effect on firm performance. We suggested that large firms more easily absorbed the additional costs of SOX with a reduced effect on research and development budgets, while small firms were less able to maintain research budgets after SOX. In the aftermath of SOX, research spending did go down, most visibly in Biotech and Electronics. As the total number of IPO firms decreased dramatically after SOX, these two research intensive industries, plus Computer Software, were the only industries with a large enough sample size to evaluate. We saw that research intensive firms diminished dramatically, along with many non-research intensive firms, from IPO events after SOX. Where we had sufficient sample size, in computer software, biotechnology, electronics, and “other”, we noted that research-intensive firms generally resisted the temptation to raid research budgets, finding funding for compliance elsewhere within the company or from the additional cash flow at time of IPO. Where firms did appear to greatly reduce research budgets was in the non-research intensive industries, where research budgets might be more of a discretionary expense. Firm size was not a factor in whether research intensive firms could better absorb the costs of SOX, although smaller firms tended to spend proportionally more on research in an effort to grow faster. After the enactment of SOX, we observed an indication that the markets valued research intensity even more than prior to SOX, perhaps understanding the vulnerability of research budgets being diverted to compliance costs. Overall, the data suggested that the effect of SOX was underestimated in this study, as the firms that were deterred from going public on U.S. exchanges were not in the sample evaluated. We only analyzed those firms prepared to accept the higher costs of SOX. The data set consisted of survivors, selected firms still willing to pay for SOX compliance as well as for research programs.
Temple University--Theses
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Zhang, Lei. "An empirical study of unit IPOS in the UK : why do firms include warrants in initial public offerings?" Thesis, University of Birmingham, 2010. http://etheses.bham.ac.uk//id/eprint/1238/.
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The main objective of this thesis is to identify the reasons why firms choose to issue unit IPOs instead of share-only IPOs. Evidence is found that unit firms are smaller, riskier, with higher level of agency costs and higher levels of information asymmetry than share-only firms and unit IPOs are underwritten by less reputable underwriters. The initial return results provide strong support to the Agency Cost hypothesis that unit IPOs is significantly more underpriced than share-only IPOs. Unit firms have lower survival rate than that of share-only IPO firms; however, unit firms that do survive are more likely to issue seasoned equity offerings (SEOs) for further funding. A clear pattern of price run-up is observed before SEO announcements by unit firms and a significant negative price adjustment is found when the SEOs are announced. In the long-term, this thesis provides evidence that unit IPOs present significantly worse underperformance comparing to both the matching share-only IPOs and various market indices. Such results contradict both the Agency Cost and the Signalling hypotheses and imply that unit firms cannot significantly improve performance by simply attaching warrants, regardless as whether they are used to reduce agency costs or to signal firm value.
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Thiess, Rolf C. "Corporate governance, professionalisation and performance of IPO firms. The role of founders and venture capitalists." Thesis, University of Bradford, 2010. http://hdl.handle.net/10454/4458.
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Combining agency theory and the resource-dependence perspective as well as signalling
theory, this thesis examines the role venture capitalists (VCs) and founders play with
respect to both structural board characteristics and board capital in terms of experience and
prestige and whether these are linked to performance.
It claims that VCs and founders shape the governance system of the firms going public and
are influential in the professionalisation of the ventures especially in terms of human and
social capital of its board of directors. It also argues that the board of directors represents a
signal of firm quality in the initial public offering (IPO) market and should thus be linked
to performance. Similarly, according to the venture capital certification hypothesis, being
funded by VCs signals a firm¿s quality and potential.
In order to assess these claims, this thesis employs a unique sample of matched venturecapital-
backed and non-venture-capital-backed entrepreneurial IPOs that floated either on
the London Stock Exchange¿s Official List or the Alternative Investment Market (AIM).
Extending previous research this thesis employs more fine-grained measures and introduces
new conceptually relevant variables in the analysis.
The findings indicate that VCs and founders are influential in shaping corporate governance
of IPO-stage ventures both from an agency and resource-provision perspective. Findings
from the examination of governance and professionalisation characteristics with respect to
IPO short-run performance (underpricing) indicate that it may the involvement of
prestigious auditors that signal firm quality while a founder bias discount seems to exist.
While evidence is found that VC involvement (and to a lesser extent director/board
characteristics) is related to post-IPO market performance, this seems to depend on the time
period following the IPO examined, whereas auditor prestige shows a positive association
in all of these time periods.Bradford University School of Management
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Thiess, Rolf Christian. "Corporate governance, professionalisation and performance of IPO firms : the role of founders and venture capitalists." Thesis, University of Bradford, 2010. http://hdl.handle.net/10454/4458.
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Combining agency theory and the resource-dependence perspective as well as signalling theory, this thesis examines the role venture capitalists (VCs) and founders play with respect to both structural board characteristics and board capital in terms of experience and prestige and whether these are linked to performance. It claims that VCs and founders shape the governance system of the firms going public and are influential in the professionalisation of the ventures especially in terms of human and social capital of its board of directors. It also argues that the board of directors represents a signal of firm quality in the initial public offering (IPO) market and should thus be linked to performance. Similarly, according to the venture capital certification hypothesis, being funded by VCs signals a firm's quality and potential. In order to assess these claims, this thesis employs a unique sample of matched venturecapital- backed and non-venture-capital-backed entrepreneurial IPOs that floated either on the London Stock Exchange's Official List or the Alternative Investment Market (AIM). Extending previous research this thesis employs more fine-grained measures and introduces new conceptually relevant variables in the analysis. The findings indicate that VCs and founders are influential in shaping corporate governance of IPO-stage ventures both from an agency and resource-provision perspective. Findings from the examination of governance and professionalisation characteristics with respect to IPO short-run performance (underpricing) indicate that it may the involvement of prestigious auditors that signal firm quality while a founder bias discount seems to exist. While evidence is found that VC involvement (and to a lesser extent director/board characteristics) is related to post-IPO market performance, this seems to depend on the time period following the IPO examined, whereas auditor prestige shows a positive association in all of these time periods.
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Matanova, N. "Private equity and venture capital investors' involvement in firms post initial public offering." Thesis, City University London, 2015. http://openaccess.city.ac.uk/11893/.
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The capital provided by private equity (PE) and venture capital (VC) investors represents an alternative type of financing available to firms in comparison to more traditional financial intermediaries such as banks, equity from owners or angel investors. These financial sponsors not only provide funding, but also complete intense restructuring, improve corporate governance, align interest of managers and shareholders, provide certification and improve performance (Jensen 1986, 1989; Baker and Wruck, 1989; Baker and Gompers, 2003; Hochberg, 2012; Acharya et al, 2009). These investors are likely to realize their highest returns by bringing their sponsored firms to the stock market in the form of initial public offerings (IPOs). However, in practice PE and VC investors do not always exit fully at the IPO date (Celikyurt et al, 2014; Krishnan et al, 2011; Cao, 2011). They tend to maintain a block ownership in some IPOs, which allows them to remain actively involved in shaping firms' corporate policies. It is of great importance to academics, practitioners and other market participants to understand why these investors carry on investing in firms they brought to the market and whether such holdings create or destroy value. These issues motivate my research agenda. I focus on investigating PE and VC investors' post-IPO presence in firms, their effect on corporate policies and impact on the long-run performance. In particular, the three chapters of my thesis pursue the following three distinct objectives: (i) to answer the fundamental question concerning the motivation of PE and VC investors to retain ownership in the post-IPO period and whether this retention affects the firm’s aftermarket performance (ii) to examine whether PE and VC investors remain active monitoring agents and exert significant influence on various corporate policies (iii) to investigate the effect of PE and VC ownership retention on firms' cash reserves, which, as documented in previous studies, can lead to significant agency conflicts. Hence, the main objective of my thesis is to explore the extent, type and channels of private equity and venture capital investors' involvement in firms post-flotation, and its impact on the long-run performance. To answer these research questions, I use a large sample of US and UK IPOs over the 1997 and 2010 period. In this dissertation, I differentiate and analyse separately firms backed by PE and VC investors because these investors are different in many respects, particularly since they provide capital to distinctive type of companies, as VCs invest mainly in young, growing, high-tech firms, while PE investors are likely to back high cash flow mature firms in stable industries. I provide a comparative analysis across these investors to assess whether, after controlling for these fundamental characteristics, their involvement, investment and strategies with their IPOs in the post flotation period are homogeneous. I also contrast the US and the UK markets which I found to be significantly different in terms of the composition of these two types of investors, but also the characteristics and annual distributions of IPOs. In the first empirical study, I focus on the motivations of PE and VC funds to retain voluntarily ownership, defined as holdings outside the lockup restrictions, in the post-IPO period. I test the monitoring and signalling hypotheses, which suggest that IPOs in which VC and PE firms retain their holdings in the post-IPO period are more likely to generate higher returns because of these funds’ certification and their ability to monitor companies in which they hold large stakes. I find that in contrast to UK, where both type of financing play an equally important role in bringing companies to the stock market, the relative importance of VC-backed IPOs in the US is time varying. Moreover, the VC-backed IPOs are equally distributed across various industries in the UK, whereas VC financing is more prominent in certain industries in the US such as high-tech, telecommunications and healthcare. I find a non-monotonic (convex) relationship between financial sponsors’ voluntary ownership and firm performance. Hence, in contrast to managers who become entrenched at higher levels of ownership, financial sponsors create value in companies they hold more concentrated equity stakes. More specifically, I document that financial sponsors’ ownership is positively related to firm value when PE and VC investors’ stake is above 1.83%. Therefore, continued involvement of financial sponsors in the post-flotation period is beneficial for the shareholders. Also, I present evidence that compulsory and voluntary financial sponsors’ equity retention is used to mitigate potential managerial expropriation of outside shareholders. I demonstrate that a different institutional framework in UK and US has a significant impact on financial sponsors’ divestment extent at the IPO date and in the post-flotation period. I find that investment banks impose significantly stricter lockup restrictions (in terms of how much shares to retain) on financial sponsors involved in US backed IPOs than in UK ones. This is driven by more dispersed ownership in US companies, whose market is defined by a lower prevalence of institutional investors and the largest group of shareholders in the US being individual investors. In addition, I find that PE/VC house and underwriter reputations are only considered to be alternative commitment devices in the UK. I also highlight a number of other factors which affect voluntary ownership of PE and VC investors in the post-IPO period. In particular, I show that PE and VC fund characteristics (syndicate size, PE/VC fund’s bank-affiliation and low proximity to IPO firm headquarters) partially explain compulsory and voluntary holdings of financial sponsors post-flotation. This paper extends the literature on IPOs' performance by demonstrating that financial sponsors divest fully from stronger firms at the IPO date, while commit their resources to underperforming ones in which they create value in the post-flotation period. The second empirical study focuses on examining whether PE and VC investors create value by actively shaping IPO firms’ corporate policies in the post-flotation period. In this paper I focus on three corporate policies, namely the corporate governance, as reflected in the structure of the board of directors, the investments’ spending patterns, and the payout policy. These decisions are identified in prior literature to have a direct impact on firm value. I demonstrate that PE and VC investors with retained ownership continue to extensively monitor their backed IPOs. However, the two types of investors implement different monitoring approaches, which are driven by fundamentally different characteristics of the firms they finance: PE investors’ ownership has a significant positive effect on the board’s size, while VC investors primarily focus on the proportion of independent directors on the board of directors. Moreover, I find that the ownership structure of financial sponsors has a material impact on monitoring of portfolio firms, as IPOs backed by bank-affiliated PE funds have significantly larger boards. In terms of investment decisions, VC investors minimize expenditures in all retained IPO firms. PE sponsors’ only reduce expenditures in IPOs with low proximity, so when PE investors’ monitoring abilities are significantly constrained by distance and hence costs of monitoring are higher. In contrast to non-backed IPOs, I find that financially sponsored companies are more likely to initiate a payout via dividends.
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Uzonwanne, Nnamdi John. "Firm and industry characteristics, long-term returns and survival of Initial Public Offerings (IPOs) : a critical re-evaluation." Thesis, University of Leeds, 2013. http://etheses.whiterose.ac.uk/5854/.
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This study tracks IPOs from the time of their entry into the public domain up to at least six years post-listing. In the first part of this study, the post-listing performance of these firms relative to that of a set of control firms in event and calendar time is evaluated, using a fresh sample of 746 IPOs in the UK market over the period 1999-2006 and stepwise matching algorithms that select the matching firms from the general population on the basis of key firm risk factors that includes three new factors – pre-IPO performance, turnover growth and earnings yield – employing a refined matching technique and a battery of methods. Given that the majority of the studies in the literature find that IPOs are poor investments in the long-term, the findings in the first part suggest firstly, that investing in IPOs beyond the immediate after-market may not be a bad trading strategy since the relative after-market performance is dependent on the proportions in which the stocks are stacked in the investor’s portfolio; secondly, value-weighted performance does not provide strong evidence against market efficiency when compared to an equally-weighted measure of abnormal performance [which tends to suggest that the former may provide a more useful benchmark in assessing the post-event risk-adjusted performance of IPO firms since it more accurately captures the investors’ wealth effects] and; thirdly, the under-performance of new issues of common stock remains an anomaly that really challenges the efficient market hypothesis only when performance is equally-weighted. In the course of analysing the performance of the firms in the first part, this work finds that the under-performance is more prevalent in some groups of IPOs than others. Hence, in the second part of the work, the economic importance and significance of key firm and industry risk factors prior to or at the IPO that may predict or explain this under-performance is tested. The author’s findings reveal that industry risk factors of IPO surplus value, profitability, market-to-book and equity volatility in addition to firm risk factors of size, market-to-book, past performance, underwriter reputation and the ‘hot’ IPO market can help distinguish the best performing from the worst performing firms. More importantly, the industry effects here are economically large and are first documented in this study. In the third and final part of the work, the firms are tracked in event and calendar time, equally using only that information that is available prior to or at the IPO. The author’s findings reveal that industry risk factors of IPO surplus value and profitability in addition to firm risk factors of size, past performance, initial market return volatility [IPO risk], underwriter prestige and the ‘hot’ IPO market can foreshadow an IPO’s survival. More importantly, the industry effects here are also first documented in this study. More particularly, the evidence here on past performance and underwriter prestige is strong and overwhelming with the results suggesting that firms desirous of going public should first build a track record of profitable performance, while the latter lays credence to the fact that firms underwritten by prestigious underwriters are less likely to fail. The results also suggest that potential IPO investors, IPO firms and their investment bankers should consider industry risk factors prevailing at the time of the IPO to provide them with additional information on whether or not to invest in the IPO [in the case of the investor] or go ahead with the IPO, or alternatively, withdraw and re-launch at a more auspicious date [in the case of the issuing firm and its investment banker].
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Jiao, Jian, and Xuan Guo. "Do Chinese underwriters grandstand to attract more firms when they are ready to go public?" Thesis, Umeå University, Umeå School of Business, 2010. http://urn.kb.se/resolve?urn=urn:nbn:se:umu:diva-34920.
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The concept of grandstanding comes from Gompers (1996), in his article, he defined “to grandstand” as “to act or conduct oneself with a view to impressing onlookers”. The idea of grandstanding does not only apply solely to venture capital but also could apply to underwriters of IPOs industry as well.
IPOs activities provide huge revenues for underwriters, so underwriters compete with each other for IPO business. China’s stock market grows explosively after 2006, and it has the highest underpricing, as well as more and more underwriters have emerged recently, so our paper is constrained under Chinese stock market environment. We empirically examine whether inexperienced underwriters grandstand when they conduct IPOs in order to achieve more market shares, for example by deliberate underpricing or charging lower fee rates.
This study is conducted from the underwriter’s perspective. We use two kinds of reputation measurement methods to define “inexperienced” and “prestigious underwriters” and employ a quantitative approach to analyze the data. Evidence from a sample of 392 IPOs from June 19, 2006 to March 24, 2010 suggests that inexperienced underwriters do not have incentives to grandstand. The number of IPOs that underwriters have conducted and recent IPO performance do not always contribute to a gain of market share directly. Therefore, inexperienced underwriters do not provide more underpriced IPOs nor do they charge lower fee rates. Evidence also marginally supports that underwriters do not intend to conduct small offer sized IPOs.
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Wigren, Anna, and Tobias Rådman. "Do Innovative Firms Leave More Money on the Table?" Thesis, Uppsala universitet, Företagsekonomiska institutionen, 2021. http://urn.kb.se/resolve?urn=urn:nbn:se:uu:diva-446546.
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This study examines the relationship between firm innovation and Initial Public Offering (IPO) underpricing in the Swedish stock market by examining 287 firms that went public on the Nasdaq OMX Stockholm and Nasdaq First North during the years 2010 – 2020. An OLS regression model is utilized to analyze the relationship between underpricing, measured as the initial returns, and firm innovation, measured as patents and Research and Development (R&D). The average initial returns for the sample were (+8,16 %) showing that IPOs are, on average, underpriced in the Swedish stock market. While the connection between patents and underpricing was negligible, the results indicated that firms that reported R&D expenditures separately, specifying how much of their expenditures were spent on R&D, experienced a small decrease in IPO underpricing. Also, a slightly larger decrease in IPO underpricing was found for the firms that both had patents and reported their IPO expenditures separately. Thus, these results indicate that firms with a higher level of innovation are “leaving less money on the table”.
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Eriksson, Johan. "Earnings management within IPO firms and private equity backing : Earnings management's affect on stock market reaction and IPO's adjustable offering." Thesis, Uppsala universitet, Företagsekonomiska institutionen, 2015. http://urn.kb.se/resolve?urn=urn:nbn:se:uu:diva-256335.
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In order to boost the exit value, it is not uncommon that issuers report earnings in excess of cash flow generated by its operations at the initial public offering (IPO). The discretionary activity of performing earnings management can mislead investors about the intrinsic value of the newly public firm. Within this study, I examine how earnings management will affect the stock market reaction upon the lockup expiration date, the IPO adjustable offering size, and how the backing of private equity or venture capital (PEVC) affects earnings management tendencies within IPO firms. Using a unique, hand-collected dataset of 56 Swedish newly public firms from 2007 - 2014, I show that IPO firms (i) manage their earnings at the full fiscal year prior to the IPO and that earnings management will result in a negative stock market reaction upon the lockup expiration date. More importantly, I show that (ii) high adjustable offerings do not affect this relationship indicating that earnings management has no impact on the adjustable part of the offering size within IPOs. I also find that (iii) IPO firms backed by PEVC firms are more eager to manipulate their earnings, and (iv) highly reputable PEVC firms do not mitigate the manipulation of earnings within IPO firms. The results taken together suggest that studying the stock market reaction on the lockup expiration date is important for manipulative IPO firm detection, and that a participation in IPOs backed by PEVC firms must be done with caution.
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Forst, Arno. "Insider Entrenchment and CEO Compensation in Entrepreneurial Firms: An Empirical Investigation." VCU Scholars Compass, 2009. http://scholarscompass.vcu.edu/etd/1714.
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This study investigates the effects of insider entrenchment on Chief Executive Officer (CEO) compensation in firms conducting an initial public offering (IPO). The sample comprises 220 US firms that went public between 1996 and 2002. Corporate governance choices regarding entrenchment are captured by six provisions in the corporate charter and bylaws, as well as five anti-takeover statutes, which may or may not be in effect in the state of incorporation. Firm-level items are supermajority requirements for charter amendments, bylaws amendments, and merger approvals, along with the presence or absence of a staggered board of directors, poison pills, and golden parachute agreements. The anti-takeover laws examined are Business Combination, Control Share Acquisition, Fair Price, Poison Pill Endorsement, and Constituencies Statutes. A factor analysis reveals three distinct components of entrenchment: firm- and state-level external entrenchment and firm-level internal entrenchment. External entrenchment is related to market control over management by means of corporate takeovers; internal entrenchment relates to shareholder control over management by means of their voting power. Evidence is found for a positive association between entrenchment at IPO and subsequent CEO cash and total compensation. These relationships are driven by firm-level external entrenchment. Firm-level external entrenchment is also significantly and positively associated with CEO stock-based compensation. The positive effects of entrenchment at IPO on CEO compensation appear not to be transitory and remain constant for at least five years post-IPO. Furthermore, entrenchment at IPO is shown to affect CEO pay-for-performance sensitivity. On balance, entrenchment reduces the sensitivity of CEO compensation to stock returns and returns on assets. The results of this study underscore the crucial importance of insiders' governance decisions made at the time of the IPO. Little support is found for a re-balancing of components of the CEO's compensation contract in response to entrenchment as predicted under the optimal contracting theory of compensation contracts. The findings of this study are almost entirely consistent with the managerial power theory, according to which entrenchment at IPO causes a permanent shift in bargaining power, which enables CEOs to influence compensation contracts in their favor.
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Schöber, Thomas. "Buyout-Backed Initial Public Offerings." kostenfrei, 2008. http://www.biblio.unisg.ch/www/edis.nsf/wwwDisplayIdentifier/3479.
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Imtiaz, Talat. "Initial public offerings in Pakistam." Thesis, University of Essex, 2004. http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.399022.
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Tastan, M. "Essays on initial public offerings." Thesis, City University London, 2014. http://openaccess.city.ac.uk/8339/.
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The present dissertation includes three essays on initial public offerings (IPO). The first chapter investigates the impact of venture capital (VC) syndicate size and diversity on the IPO and post-IPO performances of investee companies. We provide evidence that firms backed by larger and more diverse VC syndicates experience greater underpricing and lower post-IPO profitability. We suggest that this might be the consequence of coordination problems and conflicts of interests within large and heterogeneous VC syndicates which ultimately results in poorer added value for the investee companies. We also provide some evidence that the negative impact of VC syndicate size and diversity on IPO underpricing can be mitigated by the existence of alternative monitoring mechanisms such as bank loans. In the second essay, using text sentiment analysis, we investigate the relationship between tone, length and information content of prospectuses and underpricing in a sample of UK IPOs between 2004 and 2012. The peculiar feature of the UK IPO market is the wide use of fixed-priced offerings to go public, which, contrary to bookbuilding, does not allow any price discovery. Our results show that, for fixed-priced IPOs, the length of the admission document is positively correlated to the offer price and negatively correlated to underpricing and to ex-post volatility, whereas different tone and information content in the document seem to matter less. We further show that admission documents have become substantially longer for all types of IPOs since the recent financial crisis but that their impact on IPO pricing appears to be significant only during the pre-crisis period. The last chapter, the third essay, investigates how the market for European IPOs has changed, if at all, since the recent financial crisis. For this purpose we have constructed a comprehensive dataset of European IPOs between 2000 and 2012. Our research focuses on whether and how the costs, both direct and indirect, of going public have changed in the wake of the recent financial crisis. Our results suggest that both underpricing and underwriting fees have decreased since 2007. A closer look at the underwriting markets also shows that, since the financial crisis, underwriters have tended to syndicate more, and that there are some newcomers among the top ten underwriters. Additionally, we shed some light on the determinants of going public during post-crisis period, and we find that traditional models are of very little use in explaining IPO decisions during the recent recession.
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Reese, William Arthur Jr 1956. "Essays concerning initial public offerings." Diss., The University of Arizona, 1998. http://hdl.handle.net/10150/288831.
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This dissertation uses samples of Initial Public Offerings (IPOs) to examine the separate effects that a capital gains tax and investor interest have on trading volume and returns. Chapter one looks at how different tax rates for long-term and short-term capital gains and losses affect trading in IPOs. Prior to the Tax Reform Act of 1986 (TRA '86), long-term capital gains were taxed at a lower rate than short-term gains, presenting investors with an opportunity to increase their after-tax return by delaying the sale of appreciated assets until after they qualified for long-term status and selling depreciated assets prior to long-term qualification. Using a sample of Initial Public Offering, I find that stocks that appreciated prior to long-term qualification exhibit increased trading volume and decreased returns just after their qualification date, while stocks that depreciated prior to long-term qualification exhibit these effects just prior to their qualification date. Chapter two explores how the previously undefined variable "investor interest" affects an IPO's trading activity. The level of investor interest in an IPO prior to its issue influences its offer price, its initial return and its initial trading volume. After issue, this interest level impacts the stock's long-term trading volume, leading to a positive relationship between an IPO's initial return and its trading volume for more than three years after issuance. Using newspaper references as a proxy for the level of interest in a firm, I find that investor interest is positively related to initial return, initial trading volume and long-term trading volume.
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Yu, Lei, and 于雷. "Two essays on initial public offerings." Thesis, The University of Hong Kong (Pokfulam, Hong Kong), 2008. http://hub.hku.hk/bib/B4129063X.
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Singaravelu, Naidu Roubie. "Aftermarket performance of initial public offerings." Thesis, University of Cambridge, 2008. http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.611970.
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Yu, Lei. "Two essays on initial public offerings." Click to view the E-thesis via HKUTO, 2008. http://sunzi.lib.hku.hk/hkuto/record/B4129063X.
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Chua, Ansley. "Two essays on initial public offerings." Tallahassee, Florida : Florida State University, 2009. http://etd.lib.fsu.edu/theses/available/etd-07062009-151728/.
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Thesis (Ph. D.)--Florida State University, 2009.Advisor: James Ang, Florida State University, College of Business, Dept. of Finance. Title and description from dissertation home page (viewed on Nov. 3, 2009). Document formatted into pages; contains viii, 56 pages. Includes bibliographical references.
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Yea, Nikki. "Determinants of a Firm’s Return to the Market Post IPO Withdrawal." Scholarship @ Claremont, 2015. http://scholarship.claremont.edu/cmc_theses/1003.
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This paper presents a seminal analysis of firms withdrawn from the IPO market (post security regulation filings) that return later for a subsequent IPO. This study contributes to the existing literature in four ways. First, by using IPO data from 1997 to 2012 in the Japanese market, the study extends the analysis on key determinants of a firm’s returning decision after an IPO withdrawal to the Japanese market. Secondly, it identifies VC ownership percentage and market run-up value 20 ~ 40 days prior to the withdrawn IPO as the key determinants of the probability a firm will return. Thirdly, using the duration model, the paper finds that an increase in VC ownership percentage and market run-up value 0 ~ 20 days prior to the withdrawn IPO allow the subsequent IPO to take place sooner. Finally, this paper attempts to find a correlation between macroeconomic indicators and the number of withdrawals at a given time. These findings can help find the factors that influence a firm’s decision in pursuing the public market option even after a failed attempt. However, censoring issues and the use of non-stationary variables remain as limitations to my findings.
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Olausson, Leyla, and Dalman Sofia Fredrixon. "Initial Public Offering : En kvantitativ studie av IPO:ers utveckling." Thesis, Södertörns högskola, Institutionen för samhällsvetenskaper, 2017. http://urn.kb.se/resolve?urn=urn:nbn:se:sh:diva-34356.
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Inledning: Historiskt sett har IPO:er ofta varit underprissatta vilket har resulterat i att de i genomsnitt haft en hög initial avkastning, det vill säga, hög avkastning den första handelsdagen. Detta har skapat en uppfattning om att nyintroduktioner är ett bra investeringsalternativ för de som vill ha en avkastning utöver det normala. Syfte: Syftet med uppsatsen är att studera huruvida aktiers utveckling på kort och lång sikt påverkas av variabler som bolagets storlek, ålder, branschtillhörighet, noteringsperiod och könsfördelning i styrelsen. Syftet är också att undersöka huruvida IPO:er är underprissatta och om de underpresterar på lång sikt. För att studera detta har aktier noterade på Stockholmsbörsen, Aktietorget och First North mellan år 2013 och 2014 analyserats. Metod: För att kunna genomföra denna studie har ett kvantitativt tillvägagångssätt tillämpats. Vidare har en deduktiv ansats använts då avsikten var att analysera det insamlade materialet utifrån tidigare forskning. Urvalet består av 56 bolag där sekundärdata inhämtats via Nasdaq OMX, Nordnets- och Avanzas webbsida samt Skatteverket. Teori: Den teoretiska referensramen som studien baseras på består av teorier som har skapats kring hur IPO:er presterar på kort och lång sikt och varför de presterar som de gör. Vidare presenteras tidigare forskning kring hur könsfördelning i bolagsstyrelser kan påverka bolagens utveckling. Resultat och slutats: Resultatet visade att IPO:er på kort sikt blir överprissatta då de haft en negativ initial utveckling. Resultatet visade vidare att IPO:er överpresterar på lång sikt samt att de mest underprissatta IPO:erna presterar bäst. För de oberoende variablerna storlek, ålder, branschtillhörighet, noteringsperiod och könsfördelning i styrelsen kunde inga signifikanta samband återfinnas.Introduction: Historically, IPO’s have often been underpriced, which has resulted in a high initial return on average, i.e. high return on the first trading day. This has created the perception that new introduction is a good investment option for those who want an abnormal return. Purpose: The purpose of this study is to examine whether the short- and long-term performance of IPO’s are affected by variables as firm size, firm age, industry affiliation, issue period and gender diversity on board of directors. The purpose is also to determine whether IPO’s are underpriced and if they underperform in the long run. To study this, Initial Public Offerings on First North, Aktietorget and Stockholmsbörsen during the period of 2013 to 2014 have been analyzed. Methodology: To implement this study, a quantitative approach has been applied. Furthermore, a deductive approach was used since the purpose was to analyze the collected material based on previous research. The data selection consists of 56 firms were the secondary data has been obtained from Nasdaq OMX, Nordnet website, Avanza website and The Swedish Tax Agency. Theory: The theoretical frame that the study is based on consists of theories that were created regarding how IPO’s perform in short- and long-term and why they perform as they do. Furthermore, earlier research is presented which examine how gender diversity in board of directors affect corporate performance. Result and conclusions: The result in this study shows that in the short run, IPO's are overpriced due to a negative initial return. Further, the result show that IPO's outperform other companies, and the most underpriced shares perform better in the long run. For the dependent variables size, age, industry affiliation, listing period and gender diversity, no relationship of statistical significance could be found.
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Woo, Bo-loy, and 胡寶萊. "Hong Kong's initial public offerings: 1991-1995." Thesis, The University of Hong Kong (Pokfulam, Hong Kong), 1997. http://hub.hku.hk/bib/B31954832.
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Podškubka, Tomáš. "Initial Public Offerings ? teorie, empirie a praxe." Master's thesis, Vysoká škola ekonomická v Praze, 2007. http://www.nusl.cz/ntk/nusl-4242.
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Obsahem této práce je problematika primárních emisí. IPO je jedním z možných zdrojů financování dalšího rozvoje podniku, který zatím není v ČR příliš využíván. Tato práce analyzuje výhody a nevýhody IPO a provádí komparaci tohoto zdroje financování s cizími zdroji. Primární emise ve vyspělých tržních ekonomikách jsou spojovány se dvěma anomáliemi. Tato práce vysvětluje podstatu těchto jevů a rozebírá jejich příčiny. Kromě teoretických vysvětlení obou anomálii navrhuje i dva regresní modely s cílem vysvětlit příčiny rozdílného podhodnocení emisních kurzů mezi IPO firmami. Kromě toho je obsahem této práce i makroekonomický model, který zkoumá změny průměrného podhodnocení v čase. Výsledky těchto modelů potvrzují některé hypotézy obsažené v odborné literatuře. Je to zejména vliv hospodářského cyklu na IPO aktivitu v rámci makroekonomické analýzy a vliv množství investičních příležitostí, rentability a stáří firmy na podhodnocení emisních kurzů v rámci analýzy mikroekonomické. Práce dále konstatuje, že nižší výkonnost firem po IPO je do jisté míry nadhodnocena, neboť ve srovnatelnému vzorku firem již není velká. Poslední část práce se zabývá komparací IPO aktivity v ČR a Polsku. Odbourání legislativních příčin a dobrá ekonomická situace bude pravděpodobně zvyšovat počty uskutečněných IPO v ČR.
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Woo, Bo-loy. "Hong Kong's initial public offerings 1991-1995 /." Hong Kong : University of Hong Kong, 1997. http://sunzi.lib.hku.hk/hkuto/record.jsp?B20718044.
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Lüsch, Fredrik. "Aftermarket Performance of Micro-Capitalized Initial Public Offerings." Thesis, Stockholms universitet, Företagsekonomiska institutionen, 2017. http://urn.kb.se/resolve?urn=urn:nbn:se:su:diva-145169.
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The aftermarket stock price performance of micro-capitalized IPOs with penny stock status is an often-neglected subsample in the IPO research literature. As the markets in which these IPOs are often traded are subject to lower listing and disclosure requirements, there is a higher degree of asymmetrical information between issuers and investors than on more regulated exchanges. Another characteristic of micro-capitalized IPOs is the investor base, which is dominated by retail, or irrational, investors, causing the aftermarket trading to be driven by irrational behavior. With this in mind, this paper studies 139 IPOs made on the Swedish fringe marketplace Aktietorget, over the period 2007-2015, and their 15 months’ aftermarket price performance. The study adopts an event time approach to compare the returns on the IPOs to returns on a market index used as benchmark. Using a Student’s t-test and a Wilcoxon signed rank test, there are no conclusive evidence of abnormal returns that would question the Efficient Market Hypothesis. Results from multiple linear regression models, evaluating IPO price performance over a 15-month period, provide evidence for positive hot period and hot industry effects, and negative underpricing and offer price effects. Furthermore, a positive effect of post-issue company market value is evident for 3-, 6- and 12-months aftermarket periods. This paper provides evidence of return predictability of micro-capitalized IPOs using factors surrounding the IPO date, but requests additional evidence from other geographical samples, with precise definitions of normal returns.
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Sakr, Ahmed. "Determinants of board size in initial public offerings /." Available to subscribers only, 2006. http://proquest.umi.com/pqdweb?did=1147184071&sid=1&Fmt=2&clientId=1509&RQT=309&VName=PQD.
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Hsu, Hung-Chia Scott Fulghieri Paolo. "Essays on venture capital and initial public offerings." Chapel Hill, N.C. : University of North Carolina at Chapel Hill, 2007. http://dc.lib.unc.edu/u?/etd,1118.
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Thesis (Ph. D.)--University of North Carolina at Chapel Hill, 2007.Title from electronic title page (viewed Mar. 27, 2008). "... in partial fulfillment of the requirement for the degree of Doctor of Philosophy in the Kenan-Flagler Business School Finance." Discipline: Business Administration; Department/School: Business School, Kenan-Flagler.
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Wong, Chun-keung Damian, and 王振強. "Pricing of initial public offerings in Hong Kong." Thesis, The University of Hong Kong (Pokfulam, Hong Kong), 1998. http://hub.hku.hk/bib/B31269394.
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Wang, Lun, and 王仑. "Essays on stock splits and initial public offerings." Thesis, The University of Hong Kong (Pokfulam, Hong Kong), 2009. http://hub.hku.hk/bib/B42182426.
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Chiang, Sophia Yin. "Alternative valuation methods of biotechnology initial public offerings." Thesis, Massachusetts Institute of Technology, 1996. http://hdl.handle.net/1721.1/10884.
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Martínez, Sergio (Martínez Roel) 1966, and Paul M. 1961 Perron. "The valuation and pricing of initial public offerings." Thesis, Massachusetts Institute of Technology, 2004. http://hdl.handle.net/1721.1/17903.
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Thesis (S.M.)--Massachusetts Institute of Technology, Sloan School of Management, 2004.Includes bibliographical references (leaves 89-91).
Going public is an incredibly exciting and dynamic event in a company's life. The company and its management are transformed and will forever have to conduct their business differently. During the mid to late 1990s, many companies went public, creating multitudes of instant millionaires overnight, from company executives to administrative staff. Many people recognized that Initial Public Offerings (IPOs) tend to significantly increase in price on the first day of trading. As a result, there have been many academic studies to try to determine the rationale as to why IPOs are typically underpriced. Most of these academic studies have focused on the analysis of 1 st day pricing results and attempted to correlate these results to various hypotheses. We try to understand this phenomenon and corroborate the academic hypotheses by talking to those who set the offer price -the investment bankers, underwriters, and company managers- to find out why underpricing occurs. This thesis provides the reader with a better understanding of how companies are valued and the initial offering price determined, and explain the differences in opinion between academics, bankers, and management as to why underpricing occurs. To accomplish this task, we first focused on capturing underwriters' opinions regarding the valuation and pricing of IPOs. We then interviewed executives that had taken companies public to compare and contrast their views with those from the bankers, and compared them to the conclusions from academics' research.
by Sergio Martínez and Paul M. Perron.
S.M.
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Chandriotis, Cleanthis. "Initial Public Offerings in the Cyprus Stock Exchange." Thesis, Durham University, 2013. http://etheses.dur.ac.uk/9429/.
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The academic literature is quite rich in exploring Initial Public Offerings (IPOs) in developed markets and to a lesser degree in emerging markets. However, seldom one can find research on IPOs in start-up stock exchanges. Such is the case of the Cyprus Stock Exchange which was inaugurated in March 1996 and this thesis looks at IPOs that took place over a period of six years (1997-2002). Therefore, the first motivation is to explore this setting for IPOs. Moreover, the Cyprus Stock Exchange is probably the least researched stock exchange in the European Union. Out of the 12 countries that joined the European Union between 2004 and today, only Polish, Bulgarian and Hungarian IPOs are researched. Due to the comparatively young age of the Cyprus Stock Exchange and the Capital Markets in Cyprus in general at the time of the sample, the various players (underwriters, auditors, regulators, investors) were relatively inexperienced vis-à-vis the IPO process and outcomes of their actions (or rather their lack of action) affected the development of the primary market. Therefore, the second motivation stems from the specific institutional and regulatory characteristics of the CSE at the time of the sample. Cyprus, a start-up stock exchange with a relatively new but comparably densely populated market for listed companies (150 listed companies), poses an interesting research case. In particular, the institutional characteristics that existed in the Cypriot capital market over the period 1997 to 2002 (a novice stock exchange, inexperienced market participants, lack of investment options available and restrictions in capital flows, a weak legal and institutional framework) combined with a number of socioeconomic and political factors at the time make IPOs in the CSE an interesting subject for empirical research. This ‘cocktail’ of inexperience, inadequate regulation, and limited equity culture provided the platform for the formation of a large IPO ‘bubble’ which eventually imploded. Therefore, the motivation for the study develops the following research questions: 1. What is the level of first-day returns for Cypriot IPOs and how does that compare with the available literature? 2. What are the explanations for the level of short-run underpricing recorded? 3. What is the long-run (12-, 24- and 36-months) aftermarket performance of these IPOs and how does that compare with the available literature? 4. What are the explanations for the documented long-run aftermarket performance? 5. Did CSE IPO firms employ income increasing accruals prior to the IPO? 6. What is the level of understanding of Cypriot Managers of the IPO process in relation to the extant literature? This thesis consists of three inter-related empirical studies on companies that were listed on the Cyprus Stock Exchange during the period 1997 to 2002. In particular, this thesis investigates the short- and long-run IPO performance of these companies (chapter 1). The variables employed are grouped into four categories namely advisor/certifier-, market/institutional-, issuer-, and IPO-specific. It is observed that CSE IPOs over the sample period offered investors the highest returns in a European market and one of the highest in the world. Following the establishment of these ultra-high returns, and the independent variables that are related to this spectacular performance, the thesis investigates whether these CSE IPO companies engaged in income increasing accruals before their IPOs (chapter 2). In Chapter 2, both univariate as well as multivariate tests are employed to test the hypothesis that these firms actually employed earnings management pre-IPO using income increasing accruals which reversed after the 1st year of listing. In order to establish also the relationship between the short- and long-run performance of IPO firms, the latter are regressed with the earnings management variable which takes the form of discretionary accruals, total accruals or the components of accruals which are creditors, debtors, inventory, depreciation and cash flow from operations. The results show that both the short- as well as the long-run performance are also affected by the earnings management variable together with the other variables that are found to affect IPO performance in chapter 1. Having examined the two aspects of CSE IPOs, i.e., short, long performance and earnings management, the thesis presents also the results from a questionnaire survey which aims at revealing managers of CSE listed IPO companies level of understanding of the IPO process and IPO ‘anomalies’ (chapter 3) and comparing this with the extant academic literature and also with the responses of managers in the US. Great effort, both theoretical and empirical, has been made to understand managerial decision-making in the initial public offering (IPO) process. Most empirical IPO research relies on publicly available stock return data. However, there is a need to extend the literature by examining how well managers’ motivations for conducting IPOs and understanding of the IPO process correlate with existing academic theories. By surveying managers in an emerging market to obtain a real-world perspective on the IPO process, their beliefs and experiences can be compared to both academic theory and the findings from empirical research. Cypriot managers’ responses in an emerging/novice market such as the Cyprus Stock Exchange can also be compared with those of managers in a highly-developed market such as the US. The combination/integration of the above elements makes this study, the first of its kind for Initial Public Offerings in the Cyprus Stock Exchange. The results from the first study indicate the following: a. The existence of ultra-high first-day returns. b. The existence of a hot issue period. c. Long-run under-performance of IPOs over a three-year period. d. Significant institutional deficiencies. Specifically, it is observed that IPOs in the CSE offered investors initial (first day) returns that are among the higher in the world even after adjusting for the hot issue period of 1999. IPOs ‘younger’ in age, offered higher short-run returns than ‘older’ ones. Furthermore, smaller IPOs as measured by the size of gross proceeds perform better in the short-run than larger IPOs. Moreover, IPOs in certain industrial sectors offered investors the highest initial returns. It is observed that gross proceeds, the time from application to listing, the capital structure of the IPO firm (leverage), the standard deviation of market returns 21 days after the listing, and return on shareholders’ equity provide a highly explanatory model of raw initial returns. It is also found that Cypriot IPOs underperform in the long-run as the majority of IPOs in academic studies do. Cumulative Abnormal Returns (CARs) are negative for all years in the sample period during the 24-, and 36-month periods. In contrast, the 12-month period average CARs over the sample period are all positive. Moreover, IPOs in the ‘hot’ issue period have worse performance than the rest of the pack which confirms that findings of many researchers that IPOs in ‘hot’ periods have a worse performance than the rest in the long-run. The standard deviation of returns 21 days after the listing of the IPO, the capital structure of the IPO firm (leverage), the return on equity of the IPO firm prior to listing and its sales growth prior to listing offer a satisfactory explanatory model of 36-month cumulative average returns. Cypriot firms exploited a ‘window of opportunity’ that was opened in the market for listing. However, the high inefficiencies that existed and continuous changes that took place in the regulatory and institutional framework of the market as reflected predominantly by the large time span between application and listing (probably the longest in the World), had as a result huge delays in listing.
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Kostas, Dimitris. "Initial public offerings on the London Stock Exchange." Thesis, University of Manchester, 2014. https://www.research.manchester.ac.uk/portal/en/theses/initial-public-offerings-on-the-london-stock-exchange(41d0c548-e6c5-4540-878f-3dbbf57688b7).html.
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This thesis examines the non-cash compensation paid to the underwriters/brokers during the flotation process and the IPO when-issued dealing market in one of the most successful and international stock exchanges around the world, the London Stock Exchange (LSE). The thesis consists of three essays that try to answer the following questions: Do IPO firms minimise their costs of going public by issuing warrants to their financial advisers? Does the when-issued dealing affect the setting of the offer price? The first essay examines the issue of warrants to brokers as part of their compensation package in non-underwritten offerings on the Alternative Investment Market of the LSE. The main finding is that IPO firms are able to make efficient decisions and choose the contract that minimises their costs. For companies that issue warrants to their brokers the total costs of going public are 22.74% (as a percentage of gross proceeds), but would have been 25.61% had they not issued them. This 2.87% reduction in costs is equivalent to 70.34% of the commission paid to the brokers by the IPO firms. The main source of this decrease in the costs is the lower underpricing the companies incur by granting warrants to their brokers. The second essay examines the use of non-cash compensation in underwritten IPOs. The findings suggest that firms that are cash constrained are more likely to issue warrants to their underwriters. In addition, underwriters appear to have the ability to time the issue of warrants because they include them as part of their compensation package when the market is doing well. Interestingly, warrant issuers are still able to minimise their costs of going public even under a very light regulatory setting underlying the use of non-cash compensation. The third essay examines the when-issued dealing in the Main Market of the LSE for an extensive period of time, 1996 to 2012. The main finding is that, in an institutional setting in which the when-issued dealing commences only after the allocation of shares and the offer price are announced, investors pay ‘rents’ to the underwriters in order to acquire IPO shares that will trade within the when-issued dealing. These ‘rents’ take the form of a higher offer price. In other words the when-issued dealing affects the setting of the offer price. For companies that have a when issued dealing the offer price is £3.4 but would have been 54% lower (£1.55) had these firms not had a when issued dealing.
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Wang, Lun. "Essays on stock splits and initial public offerings." Click to view the E-thesis via HKUTO, 2009. http://sunzi.lib.hku.hk/hkuto/record/B42182426.
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Wong, Chun-keung Damian. "Pricing of initial public offerings in Hong Kong /." Hong Kong : University of Hong Kong, 1998. http://sunzi.lib.hku.hk/hkuto/record.jsp?B19878515.
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Taufil, Mohd Kamarun Nisham Bin. "Three essays on initial public offerings in Malaysia." Diss., The University of Arizona, 2004. http://hdl.handle.net/10150/290150.
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This dissertation is a collection of three essays related to the initial public offerings (IPOs) in Malaysia. The IPO market in Malaysia has historically been tightly regulated. However, with the formation of the Securities Commission (SC) in 1993, the regulations have eased slowly. The first essay investigates the relationship between underpricing and regulations by looking at 546 IPOs from 1990 to 2002. Underpricing refers to the initial return that an investor earns if he buys shares of the IPO at the offer price and sells it at the end of the listing day at the market price. Regulations are measured by the relaxation of the pricing method, the required allocation to indigenous investors, the mechanisms to protect minority shareholders, and the length of time periods. The first three features of regulations are unique to Malaysia. The findings are mixed regarding the relaxation of the pricing guideline in 1995 since it does not lead to lower underpricing for the period from 1996 to November 7, 1997 or before the Asian financial crisis. Fraction of shares set aside for indigenous investors does not affect underpricing; length of time from price setting to listing date relates negatively to underpricing. Finally, the protective mechanisms lead to more underpricing for firms that go public between 1996 and November 6, 1997 or those that go public after 1998, i.e., after the Asian financial crisis. The second essay looks at the relationship between the universal banking facility and the costs of going public for 546 initial public offerings listed on the Kuala Lumpur Stock Exchange from January 1990 to December 2002. It is hypothesized that by sharing private information about a firm that is going public with its affiliated commercial bank, an investment bank could lower the costs of going public for the firm. Costs of going public are measured by the degree of underpricing and gross spread, or the fees paid to the underwriters as a fraction of gross proceeds. The result in this essay is that, for the period under study, firms do not reduce the costs of going public when they use the universal banking facility. The third essay looks at the three-year performance of the IPOs in Malaysia from 1994 to 2000. Evidence from most studies in different countries finds that initial public offerings (IPOs) underperform their benchmarks or matches in the long run. However, our evidence regarding the long run performance of IPOs in Malaysia is that the IPOs do not underperform their matches. The returns of the IPOs are adjusted by using either a market index or firms with similar characteristics to the IPOs. Two different matching estimators are employed to identify the firms of similar characteristics. One of the contributions of this essay is the use of a new methodology to identify the matches for the IPOs. (Abstract shortened by UMI.)
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Toumi, Narjess. "Essays on the performance of initial public offerings." Thesis, Paris Est, 2018. http://www.theses.fr/2018PESC0005.
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Cette thèse est composée de trois essais qui étudient le déroulement des introductions en bourse. Dans le premier essai, nous examinons l’effet de la séparation propriété-contrôle sur la performance des offres publiques initiales (IPO) à long terme en France. En utilisant un échantillon de 351 entreprises françaises introduites en bourse sur la période 1997-2011, nous constatons que la séparation entre les droits de vote et les droits de propriété des actionnaires majoritaires est négativement associée à la performance à long terme des introductions en bourse. Cette constatation indique que les IPO ayant une structure de propriété dispersée sont moins performantes que les autres entreprises au cours de la période allant de 1 à 5 ans suivant l'offre initiale. Cette séparation incite les actionnaires dominants à retirer des avantages privés de contrôle au détriment des actionnaires minoritaires.Dans le deuxième essai, nous examinons le rôle des clauses de lock-up sur la précision des prévisions de résultat publiées dans le prospectus d'introduction en bourse. En utilisant un échantillon de 303 prévisions des entreprises françaises introduites en bourse entre 1997 et 2013, nous apportons la preuve que les introductions en bourse ayant plus d'actions à détenir, ainsi que celles qui choisissent des périodes de lock-up plus longues, sont plus susceptibles de divulguer des prévisions de résultats conservatrices et précises. Ces résultats sont robustes à un certain nombre de tests de sensibilité.Dans le troisième essai, nous étudions l'impact de la localisation géographique sur la sous-évaluation à court terme des introductions en bourse françaises. Les résultats montrent que les entreprises situées à proximité du centre financier parisien sont moins sous-estimées que les entreprises distantes. Ces résultats fournissent un support empirique à l'argument selon lequel l'incertitude sur la valeur des IPO augmente proportionnellement à la distance de Paris. En d'autres termes, la proximité géographique améliore la qualité des informations collectées sur les entreprises, ce qui réduit leurs coûts d'introduction en bourse et diminue le niveau des rendements initiauxThis dissertation consists of three essays. In the first essay, we investigate whether the control-ownership divergence can explain IPO long-run performance in France. Using data from a sample of 351 French IPOs during 1997-2011, we find that the separation between ownership and control rights of the largest shareholder is negatively associated with long-term performance of French IPOs. This finding indicates that IPOs with disproportional ownership structure underperform other firms in the one- to five-year period following the initial offering. Such separation induces controlling shareholders to extract private benefits of control to the detriment of minority shareholders.In the second essay, we examine the effect of lockup agreements on management earnings forecasts in initial public offering (IPO) prospectuses. Using a sample of 303 forecasts of French firms that went public over the period 1997–2013, we find that IPOs with lockup clauses are more likely to disclose conservative profit forecasts. Moreover, we provide evidence that IPOs with more shares to lock up, as well as those selecting longer lockup periods, have more accurate management earnings forecasts. These results are robust to a number of sensitivity tests.In the third essay, we examine the impact of geographic location on the short–run underpricing of French initial public offerings (IPOs). The results show that firms located in close proximity to the financial centre, Paris, are less underpriced than distant ones. These findings provide empirical support to the argument that uncertainty about IPO value increases with distance from Paris. In other words, geographic proximity improves the quality of collected information on IPO firms, which lowers their costs of going public and decreases the level of initial returns
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Lin, Michelle Ching-Yi. "Initial public offerings and board governance : an Australian study." University of Western Australia. School of Economics and Commerce, 2006. http://theses.library.uwa.edu.au/adt-WU2006.0027.
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In March 2003, the Australian Stock Exchange (ASX) released new corporate governance guidelines, which included debatable “best practice” recommendations such as the adoption of an independent board and separation of the roles of chairperson and CEO. Given the premise that strong corporate governance enhances shareholder value and, by extension, increases initial public offering (IPO) issuers’ appeal to investors, this thesis assesses the level of conformity by a sample of Australian firms, which made an IPO between 1994 and 1999, with the best practice recommendations. We also examine the relationship between firm outcomes (including IPO underpricing, post-IPO long-run performance, and the likelihood of a SEO) and board governance quality, captured by board composition, board leadership, board size and share ownership of directors. These outcomes are addressed as they are important dimensions of firm performance that may be reasonably assumed to be associated with the quality of corporate governance, and these tests can provide an insight into the preference of investors who arguably are best placed to assess the appropriateness of the recommendations promoted by the ASX. Further, we analyse changes in IPO firms’ board structures from the time of listing to five years later to determine if IPO firms adopt governance structures that are more in line with the best practice recommendations after listing and if the changes are related to IPO firms’ long-run performance. Overall, we find that IPO firms that arguably have the strongest incentive to adopt the “optimal” board structures diverge substantially from ASX’s recommendations both at the time of IPO and five years later. IPO firms’ board structures are found to be unrelated with the level of IPO underpricing and board size, after controlling for the size of the firm, is significant in explaining both long-run aftermarket performance and the probability of a SEO. IPO firms with larger boards and those that increase the board size after listing are found to perform better in the long-run. However, contrary to expectation, smaller boards are associated with a higher likelihood of equity reissuance. Overall, the results lead us to question the role played by the board of directors in signalling firm quality. Our findings also suggest that ASX’s best practice recommendations are likely to distort the market-driven practices already in place.
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Lin, Michelle Ching-Yi. "Initial public offerings and board governance : an Australian study /." Connect to this title, 2005. http://theses.library.uwa.edu.au/adt-WU2006.0027.
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Sander, Christopher, and Clara Laidlaw. "How Initial Public Offerings Change Management Control System Packages." Thesis, Uppsala universitet, Företagsekonomiska institutionen, 2016. http://urn.kb.se/resolve?urn=urn:nbn:se:uu:diva-276772.
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This study aims to further develop research, from a management approach, by studying how MCS packages change when an organization undergoes an initial public offering. Furthermore, it aims to use Malmi and Brown’s (2008) management control system package in order to categorize and analyze the complexity of organizational change brought on by an initial public offering. This study draws on interviews with top managers in a high technological firm, which has recently been listed on the stock exchange. The results of this study imply that an initial public offering can change the MCS package in a number of different ways. Public companies do not necessarily become short-term, an initial public offering can affect a company’s external focus and measurements without affecting its internal measurements, in order for companies to become suitable for the stock market they formalize policies and appoint an independent board and listed companies can experience changes to their culture.
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Govindjee, Heetal. "The performance of initial public offerings on the JSE." Master's thesis, University of Cape Town, 2012. http://hdl.handle.net/11427/12071.
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Includes abstract.Includes bibliographical references.
This study examined the performance 60 initial public offerings listing on the JSE main board between 1 January 2000 and 31 December 2011. Significant underpricing of 10.1% and 8.5% was found to exist on the first day and during first week subsequent to the IPO. Underperformance of 14.17% was found using abnormal returns and 12.91% underperformance was found when holding period returns were calculated one year after the IPO.
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Johnson, William C. "Three essays on initial public offerings and market information." Diss., Connect to online resource - MSU authorized users, 2006.
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Chen, Hui-Ling, and 陳慧玲. "The Relation between Intellectual Capital and Underpricing of Initial public Offerings Firms." Thesis, 2005. http://ndltd.ncl.edu.tw/handle/09957349453406630532.
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碩士國立中興大學
會計學研究所
93
The purpose of this study is to investigate whether the intellectual capital, which is not recorded in the financial statements, could influence the magnitude of IPOs underpricing. The paper first classify the financial and the non-financial intellectual capital into the human capital, the customer relation capital, the process capital, and the innovation capital. We further examine the relationship of these variables and the IPOs underpricing, offer price, and initial returns, and then find the core intellectual capital items and its measurement indices. These results show that information asymmetry exists among firms, underwriters, and investors, due to the unrecognized intellectual capital. Compared with general investors, firms and underwriters could easily identify the impact of unreconized Intellectual Capital on the intrinsic value of firms, because of their information advantage. Moreover, the intellectual capital has some impacts on the IPOs offer price and the honeymoon period stock price. Therefore, the initial returns is due to the reaction of underwriters and investors who think the unrecognized intangible assets of intellectual capital has the influence on the valuation of firm instead of investors’ over reaction to the valuation of firm.
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Hong, Zhen-Yong, and 洪振詠. "Audit Firm Industry Experience and Initial Public Offerings." Thesis, 1997. http://ndltd.ncl.edu.tw/handle/56376681795363597211.
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Liu, Fang-Yu, and 劉芳瑜. "Conflict of interests of security firms and the performance of initial public offerings." Thesis, 2010. http://ndltd.ncl.edu.tw/handle/21053485030867268709.
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碩士輔仁大學
金融研究所
98
According to the law, securities firms can be securities underwriter, securities dealer, and securities broker in the same time. However, there are always conflicts of interests between these three departments. Most early literatures focus on conflict of interests between only two of the three departments. This paper is the first attempt to link the three departments and examine their relationships as a whole. We use the recommendation data of brokerage department and trading data of stock trading department to calculate conflict of interest index of each securities firm. Then we examine the relationship between conflict of interest index and the performance of underwriting department. If a securities firm gets lower degree of conflict of interest index, we may infer that it has better reputation than the others. If information transmission effect does exist, the better reputation should result in better performances of the IPO stocks .The hypothesis is that the securities firms which have lower degree of conflict of interests index will have better prestige, so the IPO stocks underwritten by them will have higher abnormal return. The sampled data are IPO stocks first traded on the public stock exchange market in the year between 2001-2003 and 2007-2009. We use event study methodology to measure the performance of IPO stocks. The results show that: (1) there are negative correlation between conflict of interest index of securities firms and the performance of IPO stocks. The group of securities firms which have negative conflict of interests index have higher CAAR on IPO stocks than those who have positive conflict of interests index. (2)After ignoring the first day return, we find the group of securities firms which have positive conflict of interests index attempt to lower the IPO price. Then these IPO stocks are easy to have abnormal return in the beginning.
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Arcand, Jean-Philippe. "Institutional and strategic implications of founder-ceo transitions in firms issuing initial public offerings." Thesis, 2004. http://spectrum.library.concordia.ca/7869/1/MQ90994.pdf.
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Some of the most highly recognized CEOs were the entrepreneurial creators of their firms. These CEOs distinguished themselves, not only by starting their firms, but also by successfully managing them for long periods of time after they issued initial public offerings (IPOs) and became public. Considering such successes, it seems reasonable to ask the following question: Why do founders have a bad reputation among Venture Capitalists and Investment Bankers? Tashakori (1980) notes that Venture Capitalists realize that they put pressure on founders to leave their CEO positions. However, empirical research supporting the replacement of the Founder is limited. In this research, I examine the effect of replacing the founder with a professional CEO in firms that are issuing an initial public offering on a US stock exchange between 1996 and 2000. It is found that replacing the founder-CEO by a professional results in an increase of, on average, $12 million in the valuation of the issue. (Abstract shortened by UMI.)
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Tseng, Po-Ching, and 曾柏青. "The Long-Term Performance of Initial Public Offerings Firms Surviving more than Five Years." Thesis, 2006. http://ndltd.ncl.edu.tw/handle/01529520221568328795.
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碩士國立中興大學
財務金融系所
94
To analyze the performance of firms, this study investigates the long-run performance of 3,827 initial public offering firms (IPOs) from 1982-1994. Among the 3,827 IPOs, 1,053 firms are venture-backed and 2,774 firms are not. The result shows that the long-term underperformance improves gradually after 5 years, and the cumulative abnormal returns show an upward trend after the 6th year. This might be due to the fact that market competition eliminates 36% firms and leaves strong firms. This result also implicate that larger scale, higher visibility, expected growth, and venture-backed firms have a better performance. Therefore, this study suggests that it is a good strategy for investors to buy and hold the venture-bakced firms surviving more than 8 years in hi-tech industries with growth potentiality.
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Yu, Shih-Cheng, and 游士正. "The Effect of Management Quality on Performance of Firm’s Initial Public Offerings－Difference between Family and Non-Family Firms." Thesis, 2014. http://ndltd.ncl.edu.tw/handle/8f96v8.
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碩士國立中正大學
企業管理研究所
102
This research discusses the effect of management quality, towards top management team (TMT), on performance of firm’s initial public offerings. We investigate if better magangment quality affects investors’ strategic decisions in firm’s IPOs. In general, family firms have relatively less agency problems compared to non-family firms in its IPOs. This study selects 171 initial public offering firms in the Taiwan Stock Exchange Market from March 2005 to December 2013. The multiple regression analisis could be used to run the relationship of variables in sample firms including three major management quality dimensions: management team resources, management team structure and outside reputation of management team. The result of study shows: 1. In different IPOs underwriting price ranges, the important factors of management quality are different. It shows that team reputation is negatively related to high underwriting price range in family firms. But the relationship between team reputation and high underwriting price range is positive in non-family firms. 2. In different IPOs underpricing ranges, the influential factors of management quality are different. Basically management quality in non-family firms has significant relationship with underpricing range in defferent underpricing range. 3. Management quality has a strong influence on IPOs offer size in family or non-family firms. But it shows different impact factors. 4. Management quality severely affects numbers of IPOs co-underwriter in non-family firms. 5. Regardless of family or non-family firms, institutional investors have more intention to invest the firms with high ratio experienced management team in IPOs firms.
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Liu, Kai Mun. "Capital structure of firms after an Initial Public Offering (IPO)." 2004. http://purl.galileo.usg.edu/uga%5Fetd/liu%5Fkaimun%5F200408%5Fma.
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CHIEH, HUANG CHUANG, and 黃忠傑. "A study on the factors affecting abnormal returns on the initial public offerings of the electronic firms in Taiwan." Thesis, 2002. http://ndltd.ncl.edu.tw/handle/87024260839671978839.
Full textAbstract:
碩士大葉大學
事業經營研究所
90
Abstract Investors generally expect to gain excessive returns on newly issued stocks during the period of IPOs, which is so called “honeymoon period”. Most of the previous studies found that the abnormal returns of IPOs do exist for various honeymoon periods and returns. The purpose of this study is to examine whether if the abnormal returns exist and analyze the significant factors that affect the abnormal returns. In the study, the predicted returns of newly issued stocks on the initial 5 days、15 days and 30 days was estimated from the returns from the 60thday to the 180th day after the stocks have been listed on the exchange. Then test were conducted to see if the abnormal returns are significantly higher than zero on the three periods mentioned above. In addition, a multiple regression model was built to analyze the determinants of the abnormal returns. The empirical findings include： (1)there exist significant abnormal returns for the whole sample on 15 days and 30 days； (2) the abnormal returns for the OTC stocks are significantly higher than the exchange-listed stocks；(3)the abnormal returns during the bull market are significantly higher than during the bear market；(4) the abnormal returns of traditional electronic firms are significantly higher than the non-traditional electronic firms. The regression results indicate that the factors affecting the abnormal returns are： (1)the ratios of internal shareholders and venture capitalists are positively correlated with the abnormal returns；(2) non-traditional electronic firms have significantly lower abnormal returns；(3) the impact of the methods of underwriting and over-subscription on abnormal returns depends on various periods and sample groups. Key words：Initial Public Offerings(IPOs) ；Abnormal Return；Event Study；Taiwan Stock Mark