The short-term timing of initial public offerings
AbstractThis paper examines the effect of stock market conditions on the waiting time of initial public offering (IPO) candidates, from the date firms file a registration statement with the Securities and Exchange Commission (SEC) to the effective IPO date. I find that issuers are going public faster when time-varying stock market valuations are high, and when time-varying market returns and time-varying market volatility are low. The volatility effect is not driven by regulatory delays consecutive to changes in the terms of the offers during the IPO process. Taken together, these results indicate that firms use a short-term market timing strategy when deciding the right time to go public and are consistent with a real option interpretation of IPO timing.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Corporate Finance.
Volume (Year): 15 (2009)
Issue (Month): 5 (December)
Contact details of provider:
Web page: http://www.elsevier.com/locate/jcorpfin
IPO timing Registration period Real option Hazard analysis;
Other versions of this item:
- G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
- G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
- G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
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