 European Sovereign Debt Crisis and the performance of Dutch IPOsAndré Dorsman and Dimitrios Gounopoulos International Review of Financial Analysis, 2013, vol. 30, issue C, 308-319 Abstract: We provide new evidence of the impact of the ongoing deep financial crisis on the performance of Dutch IPOs during the period from January 1990 to May 2012. The findings indicate an increasing level of underpricing as a result of the recent financial crunch. This situation is attributed to the aggressive efforts of underwriters to create demand as well as their strong focus on rewarding investors for their participation. Their actions build the soil for long-term underperformance, a conclusion supported by multiple studies in the literature. Pre-owner loyalty signals the IPOs' quality and promotes compensation by less underpricing. Going public with the aid of a reputable underwriter does not pay off, as it does not reduce the amount of money left on the table. Consistent with the information revelation theory, we argue that the underpricing phenomenon can be largely explained by a general desire for listing. Keywords: Initial public offerings; European Sovereign Debt Crises (ESDC); Long-run share price performance (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:30:y:2013:i:c:p:308-319 DOI: 10.1016/j.irfa.2013.07.003 Access Statistics for this article International Review of Financial Analysis is currently edited by B.M. Lucey More articles in International Review of Financial Analysis from Elsevier |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.