Director networks and initial public offerings

Yi Feng, Keke Song and Yisong S. Tian

Journal of Banking & Finance, 2019, vol. 106, issue C, 246-264

Abstract: We investigate how director networks impact IPO characteristics and find that firms with better-connected directors have higher IPO market valuation, more positive offer price revisions, higher first-day returns, more pre-IPO media coverage, and superior post-IPO stock performance. Director networks are beneficial to the share offering because corporate directors help facilitate information exchange with prospective investors, attract their attention to the IPO, and maintain and grow their interest after the IPO.

Keywords: Director networks; Network centrality; IPO underpricing; Offer price revision; IPO valuation; Investor attention; Pre-IPO media coverage; Post-IPO stock performance (search for similar items in EconPapers)
JEL-codes: G3 G30 G32 G34 L14 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbfina:v:106:y:2019:i:c:p:246-264

DOI: 10.1016/j.jbankfin.2019.07.001

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