Second Time Lucky? Withdrawn Ipos that Return to the Market
53 Pages Posted: 19 Oct 2004
Date Written: October 18, 2004
Abstract
We investigate issuers withdrawing an IPO (after security regulation filings) that return later for a successful offering. Venture capital backing and reputation of the lead underwriter are key factors in predicting successful return. The possibility of returning has a significant impact on the choice to withdraw and the pricing of offerings that succeed. Our sample of returning IPOs also provides a unique setting to investigate underwriter switching after a withdrawal but before a successful IPO. We find that switching occurs in response to poor bank performance and when switching firms "graduate" to banks that have high industry market shares.
Keywords: IPOs, withdrawals, return performance, investment bank reputation, switching
JEL Classification: G14, G24, G32
Suggested Citation: Suggested Citation
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