Product Market Advertising and Initial Public Offerings: Theory and Empirical Evidence

2004 ◽  
Author(s):  
Thomas J. Chemmanur ◽  
An Yan
Keyword(s):  
Empirical Evidence ◽  
Initial Public Offerings ◽  
Product Market ◽  
Public Offerings

scholarly journals CAN ACCOUNTING INFORMATION ACT AS A PROXY FOR EX ANTE UNCERTAINTY IN INITIAL PUBLIC OFFERINGS?

2003 ◽  
Vol 5 (2) ◽  
pp. 249 ◽  
Author(s):  
Tatang Ary Gumanti
Keyword(s):  
Empirical Evidence ◽  
Initial Public Offerings ◽  
Initial Public Offering ◽  
Accounting Information ◽  
Firm Risk ◽  
Public Offerings ◽  
Accounting Numbers ◽  
Ex Ante ◽  
Value Of Firm ◽  
Public Offering

This paper reviews and summarizes previous works and the rationale for the proposition that accounting information is in fact value relevant in the determination of an initial public offering IPO).Theoretical and empirical evidence has indicated that certain accounting measures can he used as proxies for total firm risk, that is, they could determine the riskiness of a corporation. The literature also advocates that accounting information is relevant in determining the value and thus the riskiness of a corporation through the use of accounting analysis. Since most of the information available in the prospectus is accounting information, it is arguable that this information represents a potential source for assessing the issuing firm. Some scholars have also advocated the possibility of using accounting information in assessing the value of firm making an IPO. Numerous papers have provided analytical and empirical evidence of the association between accounting numbers and the value of IPOs. The conclusion generally comes to show that information in the prospectus is value relevant concerning the IPO. The paper shows that it is indeed an arguable to use accounting information in the valuation of an IPO. Accordingly, it is an empirical issue whether accounting information has the property in explaining the ex-ante uncertainty of an IPO.

scholarly journals Underpricing and corporate governance－Evidence from Taiwan securities market

2007 ◽  
Vol 4 (2) ◽  
pp. 69-73 ◽  
Author(s):  
Tzong-Huei Lin
Keyword(s):  
Corporate Governance ◽  
Empirical Evidence ◽  
Initial Public Offerings ◽  
Negative Relationship ◽  
Independent Directors ◽  
Governance Reform ◽  
Public Offerings ◽  
The Government ◽  
Using Data ◽  
Set Up

To enhance the corporate governance of listed firms, Taiwan prescribes that the initial public offerings (IPOs) after February 19, 2002, have to set up at least two independent directors and one independent supervisor who posses financial or accounting expertise. The corporate governance reform of Taiwan offers an opportunity to investigate the effect of corporate governance on IPOs market. Using data from Taiwan’s initial public offerings (IPOs), this study documents evidence that the magnitudes of under-pricings of IPOs after 2002 are significantly smaller than those of before. This shows that the corporate governance can reduce the investors’ uncertainty about the IPOs. The empirical evidence also indicates that the percentage of shares holdings owned by directors/supervisors is demonstrated to have negative relationship with the underpricing of the IPOs. This study contributes to the literature in the following ways. First, as Ritter and Welch (2002) suggest that future progress in the IPO underpricing literature will mainly come from agency conflict explanation, this study provides evidence about the effect of corporate governance on IPOs market. Second, as for the issue about the policy implication of the SFB 2002’ rules, this study provides the empirical evidence. Third, whether the government should prescribe the firms to set up independent directors? This study offers a direction for future discussion.

scholarly journals THE ROLE OF DUALITY MANAGERIAL OWNERSHIP AND BOARDS ON IPO VALUE (AN EMPIRICAL EVIDENCE OF INDONESIAN FIRMS)

2020 ◽  
Vol 5 (2) ◽  
pp. 162-179
Author(s):  
Maximus Leonardo Taolin ◽  
Julia Safitri
Keyword(s):  
Empirical Evidence ◽  
Initial Public Offerings ◽  
The Other ◽  
Managerial Ownership ◽  
Public Offerings ◽  
Managerial Role ◽  
Other Hand ◽  
High Level ◽  
The Impact

The research aims to find the impact of ownership retention, managerial ownership, and boards on value IPO premium and underpricing. We investigate by using hand collect data 202 IPO prospectuses during 2008-2017 and using Warp PLS 5.0 to compute the data. Our finding suggests that may use to guide the investor in making informed decisions to see the level of the proportion of sharehold by old ownership and management. When the high level of ownership retention and managerial ownership, make the value IPO premium and underpricing will be high. On the other hand duality of the managerial role in firms making the value will be achieved. This paper contributes to the value of IPO premium and underpricing literature when influence by ownership share on initial public offerings  context of emerging markets.Keywords: Ownership retention; Managerial Ownership; Boards; IPO premium; underpricing

IPOs versus Acquisitions and the Valuation Premium Puzzle: A Theory of Exit Choice by Entrepreneurs and Venture Capitalists

2011 ◽  
Vol 46 (6) ◽  
pp. 1755-1793 ◽  
Author(s):  
Onur Bayar ◽  
Thomas J. Chemmanur
Keyword(s):  
Initial Public Offerings ◽  
Market Competition ◽  
Product Market ◽  
Venture Capitalists ◽  
Public Offerings ◽  
Exit Mechanism ◽  
The Difference ◽  
Exit Choice ◽  
Premium Puzzle ◽  
Considerable Support

AbstractWe analyze a private firm’s choice of exit mechanism between initial public offerings (IPOs) and acquisitions, and we provide a resolution to the “IPO valuation premium puzzle.” The private firm is run by an entrepreneur and a venture capitalist (VC) (insiders) who desire to exit partially from the firm. A crucial factor driving their exit choice is competition in the product market: While a stand-alone firm has to fend for itself after going public, an acquirer is able to provide considerable support to the firm in product market competition. A second factor is the difference in information asymmetry characterizing the two exit mechanisms. Finally, the private benefits of control accruing to the entrepreneur post-exit and the bargaining power of outside investors versus firm insiders are also different across the two mechanisms. We analyze two situations: the first, where the entrepreneur can make the exit choice alone (independent of the VC), and the second, where the entrepreneur can make the exit choice only with the concurrence of the VC. We derive a number of testable implications regarding insiders’ exit choice between IPOs and acquisitions and about the IPO valuation premium puzzle.

Institutional Allocation in Initial Public Offerings: Empirical Evidence

2002 ◽  
Vol 57 (3) ◽  
pp. 1421-1442 ◽  
Author(s):  
Reena Aggarwal ◽  
Nagpurnanand R. Prabhala ◽  
Manju Puri
Keyword(s):  
Empirical Evidence ◽  
Initial Public Offerings ◽  
Public Offerings
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