Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5090051 | Journal of Banking & Finance | 2012 | 13 Pages |
Abstract
We examine the acquisition valuations of withdrawn-IPOs - private targets that are acquired after they file and then withdraw their IPOs - to examine how IPO registration and withdrawal affect valuations of withdrawn-IPOs in their subsequent mergers. We find that these “almost public” withdrawn-IPOs sell at a significant acquisition premium relative to comparable pure private targets that never file IPO registration and at acquisition valuations similar to comparable public targets. The premium persists only for withdrawn-IPOs that are acquired before their IPO withdrawals after other factors are controlled for. These findings confirm that there is a significantly positive (negative) valuation impact of IPO registration (IPO withdrawal) on withdrawn-IPOs' subsequent acquisitions. The two effects offset each other for withdrawn-IPOs that are acquired after their IPO withdrawals.
Related Topics
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Authors
Qin Lian, Qiming Wang,