Underpricing And Performance Of Private Equity Backed Ipos In Germany PDF Download
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Author | : Matthias Hetzenecker |
Publisher | : GRIN Verlag |
Total Pages | : 76 |
Release | : 2020-11-19 |
Genre | : Business & Economics |
ISBN | : 3346299635 |
Download Value creation by private equity-backed IPOs. Underpricing and long-term performance in Germany Book in PDF, ePub and Kindle
Bachelor Thesis from the year 2019 in the subject Business economics - Review of Business Studies, grade: 1,0, University of applied Sciences Regensburg, language: English, abstract: This paper examines value creation by private equity-backed IPOs. It gives detailed insights on a mostly US-based research topic analyzing 134 German IPOs from 2002 to 2018, of which 49 were identified as PE-backed, and contributes empirical evidence on the discussion of private equity value creation. The empirical results provide detailed information on whether private equity financing can be a suitable financing source for companies by comparing and analyzing the performance differences between IPOs of companies with and without private equity sponsors. Furthermore, the paper provides empirical evidence on the IPO phenomena of underpricing and negative long-term performance for Germany, differentiating itself from former studies in terms of a broader time horizon and an extensive return calculation methodology. Since the locust swarms debate initiated by SPD politician Franz Müntefering, private equity investors have had to struggle with an extremely bad reputation in Germany. Unpopular measures such as company divestures or mass redundancies to achieve set turnover and return targets reinforce the negative image of financial investors. Accordingly, investor and business magnate Warren Buffet criticized that businesses under private equity control become a piece of merchandise. Nonetheless, the private equity industry continues to boom, reaching new records in terms of global business volume and transactions. Under these circumstances and new evolving discussions, it is essential to take a close look at the business model of private equity firms and to analyze potential short- and long-term value creation in their portfolio companies.
Author | : Justyna Dietrich |
Publisher | : diplom.de |
Total Pages | : 76 |
Release | : 2011-10-27 |
Genre | : Business & Economics |
ISBN | : 3842821727 |
Download IPO Underpricing in Germany - Empirical Analysis of Influencing Variables Book in PDF, ePub and Kindle
Inhaltsangabe:Introduction: Detected on the US market centuries ago, underpricing is the phenomenon of abnormal first-day returns from initial public offerings (IPOs). Without doubt, any US investor would agree, that one day-returns of 11.4% on average are exceptional and a worthwhile investment. Since then many studies have proven that it is a persistent phenomenon and also occurs on markets all over the world. The most puzzling question for scientists is why companies are leaving this money on the table and don t set an offering price that reflects the market demand at the offering date. Within that, researchers have also been trying to determine the factors that influence the severity of underpricing. Many different explanations with regard to the existence of underpricing have been derived thus far, with all claiming to be valid even if not exclusively. But despite this effort, research so far has not been able to create common sense. Some even argue that underpricing may not exist at all since most IPOs underperform severely in the long-run which leads some people to the conclusion that IPOs are in fact overpriced. The main focus of this paper is whether and how the findings of past research, primarily conducted for the US market, apply to the German IPO market. As a result, both investors and issuers shall receive practical implications for their decision-making within the IPO process. So far, profound underpricing research for the German market has been rather scarce. Most of the available literature concentrates either on dates before 1997 when most offering prices have been determined by using the fixed price mechanism whereas the most recent studies focus on the German stock exchange segment Neuer Markt exclusively. In contrast, this paper aims to give a more recent analysis of underpricing on the German market without distinguishing between different market segments. Additionally, a broad over-view and understanding of IPO underpricing, taking the long-run performance of IPOs into account, will be included. As a result, this paper is structured as follows: The second section consists of a description of some of the important theoretical aspects that have influence on the price setting of an IPO. It will concentrate on business valuation as it is the basis for setting the price of an IPO. Furthermore, the most common price setting mechanisms shall be explained. Additionally, the special role of the lead underwriter in the IPO [...]
Author | : Christian von Drathen |
Publisher | : |
Total Pages | : 51 |
Release | : 2014 |
Genre | : |
ISBN | : |
Download The Performance of Private Equity-Backed Initial Public Offerings in Germany Book in PDF, ePub and Kindle
This paper investigates the long-term stock price performance of initial public offering (IPO) firms in Germany that were previously owned by private equity (PE) funds. A sample of 138 PE-backed IPOs (33 buyout- and 105 venture-backed) and 383 non-PE-backed IPOs between 1990 and 2007 is analysed for the long-term performance of these offerings. The analysis suggests that PE-backed IPOs outperform the stock market over the three-year term. On a risk-adjusted basis, returns are positive over a five-year post-IPO period. Within the PE-backed sample, venture capital-backed IPOs outperform buyout-backed offerings.
Author | : Oliver Reiche |
Publisher | : diplom.de |
Total Pages | : 102 |
Release | : 2014-06-01 |
Genre | : Business & Economics |
ISBN | : 3954897954 |
Download The Phenomenon of IPO Underpricing in the European and U.S. Stock Markets Book in PDF, ePub and Kindle
The Initial Public Offering (IPO) marks one of the most important events of a company. Basically, the aim is to generate maximum proceeds by selling the company’s shares to investors. However, the shares that are sold seem to be underpriced as the price significantly soars on the first trading day. Since the very first detection of this phenomenon in the United States in 1969, several subsequent studies have documented the existence of worldwide IPO underpricing. This study focuses on IPO Underpricing in the European and United States Stock Markets by outlining and discussing the following essential issues: What is underpricing in the context of the IPO? Which motivations are there and how do they impact? Is there IPO underpricing in the markets of Europe and the United States of America?
Author | : Matthias Meier |
Publisher | : |
Total Pages | : 31 |
Release | : 2010 |
Genre | : Going public (Securities) |
ISBN | : |
Download Underpricing and Performance of Private Equity Backed IPOs in Germany Book in PDF, ePub and Kindle
Author | : Marius Hamer |
Publisher | : GRIN Verlag |
Total Pages | : 72 |
Release | : 2007-06-20 |
Genre | : Business & Economics |
ISBN | : 3638733432 |
Download Empirical Evidence on IPO-Underpricing Book in PDF, ePub and Kindle
Diploma Thesis from the year 2007 in the subject Business economics - Investment and Finance, grade: 1,3, European Business School - International University Schloß Reichartshausen Oestrich-Winkel, language: English, abstract: This paper aims at establishing a link between the average level of initial return of IPO shares, existing underpricing explanations and the dot-com bubble. In years prior to the boom of the new economy, underpricing was explained by various theories, which have extensively been developed since decades. However, in the years 1998 to 2001 IPOs were overly underpriced, leading to assumptions about behavioural aspects and investor irrationality. Analysing a comprehensive dataset of 371 IPOs on the Frankfurter Börse between 1997 and 2007, this paper aims at providing evidence that the observed lower levels of initial returns in recent years can indeed be aligned with existing theories on the basis of rational behaviour of market participants. Firstly, the IPO process and its major participants will be presented followed by a review of relevant studies on the IPO phenomenon. In the next step, established underpricing theories are recapitulated. A descriptive analysis of the data sample points out the particularities concerning the company and transaction characteristics of the sample firms. In a last step, a regression analysis relates various proxies for information asymmetry to established underpricing theories. It gives reason to believe that the irrationality at the turn of the century has vanished and that underpricing can again be explained by established theories.
Author | : Karin Jauch |
Publisher | : |
Total Pages | : |
Release | : 2013 |
Genre | : |
ISBN | : |
Download Performance of Private Equity Backed IPOs Book in PDF, ePub and Kindle
Author | : Li Shuying |
Publisher | : |
Total Pages | : |
Release | : 2015 |
Genre | : |
ISBN | : |
Download Influences of Private Equity Investment Upon IPO Underpricing on Growth Enterprices Market Board Book in PDF, ePub and Kindle
Author | : Andreas Oehler |
Publisher | : |
Total Pages | : |
Release | : 2017 |
Genre | : |
ISBN | : |
Download IPOs, the Level of Private Equity Engagement and Stock Performance Matters Book in PDF, ePub and Kindle
Research on IPOs commonly focuses on the relation between firms' pre IPO ownership structure and subsequent stock performance. We extend the literature by additionally focusing on companies' post IPO ownership structure, in particular private equity capital engagement, to analyze IPOs stock performance matters. For this purpose, we employ a unique dataset on German IPOs from 2004 to 2014 that allows us to identify companies' ownership structures before and after the IPO. We compute stocks' market-adjusted returns and information ratios for the first 200 trading days to answer two research questions. First, do stocks of companies that were (partially) owned by private equity investors prior the IPO show a different performance after the IPO than stocks of companies without prior investments of private equity investors? Second, does the extent of private equity investors' involvement at the IPO (i.e. their pre and post IPO shareholdings) influence the stock performance following the IPO? We do not find evidence that stocks of companies, which had private equity investors as shareholders prior to the IPO, outperform stocks of companies without private equity investors per se. However, for the subsample of companies that had private equity investors as shareholders we document that the stronger the private equity investors reduce their engagement the stronger is the performance of the issued stock.
Author | : 林璟如 |
Publisher | : |
Total Pages | : |
Release | : 2017 |
Genre | : |
ISBN | : |
Download Underpricing and Stock Market Performance of Venture Capital Backed IPO Book in PDF, ePub and Kindle