The Information Content of IPO Prospectuses

• 成果类型: Article
• 署名作者: Hanley, Kathleen Weiss; Hoberg, Gerard
• 署名单位: Federal Reserve System - USA; Federal Reserve System Board of Governors; University System of Maryland; University of Maryland College Park
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhq024
• 发表日期: 2010
• 页码: 2821
• 关键词: disclosure; COMMUNICATION; allocation; INNOVATION; banking; essays; text

摘要

Using word content analysis, we decompose information in the initial public offering prospectus into its standard and informative components. Greater informative content, as a proxy for premarket due diligence, results in more accurate offer prices and less underpricing, because it decreases the issuing firm's reliance on bookbuilding to price the issue. The opposite is true for standard content. Greater content from high reputation underwriters and issuing firm managers, through Management's Discussion and Analysis, contribute to the informativeness of the prospectus. Our results suggest that premarket due diligence and disclosure by underwriters and issuers can serve as a substitute for costly bookbuilding. (JEL G14, G24, G30, G32)