The option to withdraw IPOs during the premarket: empirical analysis

• 成果类型: Article
• 署名作者: Busaba, WY; Benveniste, LM; Guo, RJ
• 署名单位: University of Arizona; University of Minnesota System; University of Minnesota Twin Cities; University of Illinois System; University of Illinois Chicago; University of Illinois Chicago Hospital
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/S0304-405X(01)00040-X
• 发表日期: 2001
• 页码: 73-102
• 关键词: initial public offerings; option to withdraw; Bookbuilding; Price discovery

摘要

American IPOs are priced after a process of bookbuilding, during which issuers can withdraw at any time. We hypothesize that the option to withdraw reduces underpricing by strengthening the issuers' bargaining power with respect to investors. Empirical analysis reveals that underpricing is lower when investor perception of an IPO's likelihood of withdrawal is higher. Withdrawing issuers are neither smaller nor less profitable than issuers completing their IPOs, and engage underwriters that are as reputable as those managing completed offerings. Withdrawal is correlated with leverage, intended use of proceeds, expected issue size, venture backing, revenues, NASDAQ returns, and IPO activity. (C) 2001 Published by Elsevier Science S.A.