MOTIVES AND EFFECTS OF THE INITIAL PUBLIC OFFERINGS ON THE WARSAW STOCK EXCHANGE
Tomasz Sosnowski ()
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Tomasz Sosnowski: University of Lodz
Equilibrium. Quarterly Journal of Economics and Economic Policy, 2015, vol. 10, issue 2, pages 207-222
This paper empirically investigates the links between the motives for going public and changes in the market value and efficiency of new stock companies. Using a sample of 200 firms from Warsaw Stock Exchange between 2005 and 2012 I find that the principal purpose of initial public offering is raising additional capital by the company but divestment grounds of initial shareholders are also important. I find evidence that the sale of secondary shares in the initial public offering may be seen as a negative signal at aftermarket performance of the firm. The data reveal that the most adverse long-term changes in the market value and business efficiency are observed for those companies, where in the initial public offering both primary and secondary shares were sold.
Keywords: initial public offering; primary shares; secondary shares; motives for going public (search for similar items in EconPapers)
JEL-codes: G32 G23 (search for similar items in EconPapers)
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Persistent link: http://EconPapers.repec.org/RePEc:pes:ierequ:v:10:y:2015:i:2:p:207-222
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