The book-building procedure for selling initial public offerings to investors has captured significant market share from auction alternatives in recent years, despite significantly lower costs in both direct fees and initial underpricing when using the auction mechanism. This paper shows that in...

We examine initial public offerings (IPOs) with single, multiple, and no credit ratings. We document a beneficial effect of credit ratings on IPO underpricing, which is amplified by the existence of multiple credit ratings. Multiple ratings also reduce the extent of filing price revisions....