Committed Anchor Investment and IPO Survival -The Roles of Cornerstone and Strategic Investors

Susanne Espenlaub; Arif Khurshed; Abdulkadir Mohamed; Brahim Saadouni

doi:10.1016/j.jcorpfin.2016.08.016

Committed Anchor Investment and IPO Survival -The Roles of Cornerstone and Strategic Investors

Susanne Espenlaub, Arif Khurshed, Abdulkadir Mohamed, Brahim Saadouni

A&F Accounting & Finance

Cranfield University

Research output: Contribution to journal › Article › peer-review

451 Downloads (Pure)

Abstract

Recent U.S. policy encourages anchor investments to facilitate initial public offerings (IPOs) and increase companies’ access to external finance. As access to external funds relies on stocks remaining listed, we study anchor investors’ impact on how long IPOs stay listed. We examine two types of anchor investors in Hong Kong: strategic and cornerstone investors, that are similar to U.S. anchor investors, but show varying levels of commitment to the IPO. We find that IPOs backed by more committed investors, with longer post-IPO commitments (lockups), stay listed longer. This suggests that the success of U.S. policies may require investors’ commitment.

Original language	English
Pages (from-to)	139-155
Number of pages	17
Journal	Journal of Corporate Finance
Volume	41
Early online date	31 Aug 2016
DOIs	https://doi.org/10.1016/j.jcorpfin.2016.08.016
Publication status	Published - Dec 2016

Access to Document

10.1016/j.jcorpfin.2016.08.016

45681614.Hong Kong IPO Survival paperAccepted author manuscript, 580 KB

Cite this

@article{a977e9b6afab4a52ad9f29c0faf8de5a,

title = "Committed Anchor Investment and IPO Survival -The Roles of Cornerstone and Strategic Investors",

abstract = "Recent U.S. policy encourages anchor investments to facilitate initial public offerings (IPOs) and increase companies{\textquoteright} access to external finance. As access to external funds relies on stocks remaining listed, we study anchor investors{\textquoteright} impact on how long IPOs stay listed. We examine two types of anchor investors in Hong Kong: strategic and cornerstone investors, that are similar to U.S. anchor investors, but show varying levels of commitment to the IPO. We find that IPOs backed by more committed investors, with longer post-IPO commitments (lockups), stay listed longer. This suggests that the success of U.S. policies may require investors{\textquoteright} commitment.",

author = "Susanne Espenlaub and Arif Khurshed and Abdulkadir Mohamed and Brahim Saadouni",

year = "2016",

month = dec,

doi = "10.1016/j.jcorpfin.2016.08.016",

language = "English",

volume = "41",

pages = "139--155",

journal = "Journal of Corporate Finance",

issn = "0929-1199",

publisher = "Elsevier BV",

}

TY - JOUR

T1 - Committed Anchor Investment and IPO Survival -The Roles of Cornerstone and Strategic Investors

AU - Espenlaub, Susanne

AU - Khurshed, Arif

AU - Mohamed, Abdulkadir

AU - Saadouni, Brahim

PY - 2016/12

Y1 - 2016/12

N2 - Recent U.S. policy encourages anchor investments to facilitate initial public offerings (IPOs) and increase companies’ access to external finance. As access to external funds relies on stocks remaining listed, we study anchor investors’ impact on how long IPOs stay listed. We examine two types of anchor investors in Hong Kong: strategic and cornerstone investors, that are similar to U.S. anchor investors, but show varying levels of commitment to the IPO. We find that IPOs backed by more committed investors, with longer post-IPO commitments (lockups), stay listed longer. This suggests that the success of U.S. policies may require investors’ commitment.

AB - Recent U.S. policy encourages anchor investments to facilitate initial public offerings (IPOs) and increase companies’ access to external finance. As access to external funds relies on stocks remaining listed, we study anchor investors’ impact on how long IPOs stay listed. We examine two types of anchor investors in Hong Kong: strategic and cornerstone investors, that are similar to U.S. anchor investors, but show varying levels of commitment to the IPO. We find that IPOs backed by more committed investors, with longer post-IPO commitments (lockups), stay listed longer. This suggests that the success of U.S. policies may require investors’ commitment.

U2 - 10.1016/j.jcorpfin.2016.08.016

DO - 10.1016/j.jcorpfin.2016.08.016

M3 - Article

SN - 0929-1199

VL - 41

SP - 139

EP - 155

JO - Journal of Corporate Finance

JF - Journal of Corporate Finance

ER -

Committed Anchor Investment and IPO Survival -The Roles of Cornerstone and Strategic Investors

Abstract

Access to Document

Fingerprint

Cite this