PRE-LISTING FIRM CHARACTERISTICS AND THE LONG-TERM PERFORMANCE OF INITIAL PUBLIC OFFERINGS - EVIDENCE FROM THE UK IPO MARKET BETWEEN 1998 AND 2002

Zuo, Liya (2006) PRE-LISTING FIRM CHARACTERISTICS AND THE LONG-TERM PERFORMANCE OF INITIAL PUBLIC OFFERINGS - EVIDENCE FROM THE UK IPO MARKET BETWEEN 1998 AND 2002. [Dissertation (University of Nottingham only)] (Unpublished)

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Abstract

ABSTRACT

Consistent with Khurshed et al. (1999), this study proposes that the long-term performance of IPOs is a function of pre-IPO factors prescribing the characteristics of firms, including firm size, risk, multi-nationality and industry categorisation, since the manner in which a company is run before it is listing on the stock exchange may give a strong indication of how its offering will perform in the long-run. With the aid of a new dataset collected from the UK IPO market between 1998 and 2002, this study aims to re-assess the validity of the findings generated in Khurshed et al. (1999), which seem to have been neglected by other empirical researchers.

In this paper, cross-sectional and regression analysis consistently suggest that initial IPO returns on the first trading day is the most significant predictor of IPO long-term performance and they are adversely related. Market capitalisation value and pre-listing profitability of a firm can also be used to gain important insights into the long-term potential of its offerings. While the power of other factors like multi-nationality, cost of flotation and ownership structure in explaining IPO long-term performance identified to be significant in Khurshed et al. (1999) were reported to be minor.

Item Type: Dissertation (University of Nottingham only)
Keywords: Initial Public offerings (IPO), Long-term Performance
Depositing User: EP, Services
Date Deposited: 05 Jan 2007
Last Modified: 24 Oct 2016 04:07
URI: http://eprints.nottingham.ac.uk/id/eprint/20341

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