Purpose – The purpose of this paper is to analyse the role of ownership characteristics in a firm's choice of alternative seasoned equity offering (SEO) methods, offer price discounts, and market reactions to such announcements within the UK setting.Design/methodology/approach – The study...

Nearly 40% of IPO firms redact information from their SEC registration filings. These firms exhibit characteristics consistent with the need to shield proprietary information from potential rivals. They experience greater underpricing, but pre-IPO insiders reduce underpricing-related wealth...

Based on a dataset including 11,636 private debt placements issued globally between 1999 and 2016, we investigate the association between borrower-lender information asymmetry and the cost of debt for issuers. We observe that information asymmetry due to being a private or unrated firm is...

This paper offers a novel framework, combining firm operational risk, IPO pricing risk, and market risk, to model IPO failure risk. By analyzing nearly a thousand variables, we observe that prior IPO failure risk models have suffered from a major missing-variable problem. Evidence reveals...

Legal investor protection is associated with how firms choose to issue shares. The likelihood of private placements relative to rights offerings increases with investor protection, as does the likelihood of public offerings relative to both private placements and rights offerings. These findings...

The literature shows that the first-day return in an IPO is positively related to the market return leading up to the issue. We propose a new model for this puzzling predictability by adding a public signal to the Benveniste and Spindt (1989) information-based framework. The public signal...

The firm geographic location matters in IPOs because investors have a strong preference for newly issued local stocks and provide abnormal demand in local offerings. Using equity holdings data for more than 53,000 households, we show the probability to participate to the stock market and the...

I hypothesize that highly innovative firms — those with high risk, yet higher potential return — will be more likely to raise funds through stock markets than through bond issuance. Using the Schumpeterian innovation life-cycle as a theoretical framework, I argue that that in the beginning,...

We examine the performance of initial public offerings (IPO) using a stochastic dominance approach that allows us to capture IPO investors’ preferences for higher moments of the returns distribution. We use a comprehensive sample of 6,671 IPOs in the U.S. with IPO dates from 1980 to 2012, and...