The Strategic Reallocation of IPO shares

Fabio Bertoni and Giancarlo Giudici
Additional contact information
Giancarlo Giudici: POLIMI - Politecnico di Milano [Milan]

Post-Print from HAL

Abstract: In this work, we study the reallocation of shares to retail and institutional investors, measured as the difference between the allocation declared before the initial public offering (IPO) and the effective allotment decided by the underwriter after the bookbuilding process. The reallocation is disaggregated into three components, two of which are under the direct control of the underwriter: the initial allocation, and the demand satisfaction ratio. The empirical analysis is based on a sample of 193 hybrid IPOs issued in Italy between 1997 and 2012. Controlling for firm and IPO characteristics, we find that the IPO shares are typically shifted toward institutional investors when positive information is collected during the bookbuilding process. The IPO pricing and share reallocation are found to be interdependent, and reallocation is used in combination with partial adjustment to reward institutional investors.

Date: 2014-02-01
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Published in Journal of Banking & Finance, 2014, 39, 211-222 p. ⟨10.1016/j.jbankfin.2013.11.020⟩

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Journal Article: The strategic reallocation of IPO shares (2014)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-02313117

DOI: 10.1016/j.jbankfin.2013.11.020

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().