TY - JOUR
T1 - Underwriting in the Australian IPO markets
T2 - determinants and pricing
AU - Marsden, Alastair
AU - Murgulov, Zoltan
AU - Rhee, S. Ghon
AU - Veeraraghavan, Madhu
N1 - Funding Information:
The author(s) disclosed receipt of the following financial support for the research, authorship, and/or publication of this article: S Ghon Rhee is grateful for the 2020 Summer Research Grant of the Shidler College of Business.
Publisher Copyright:
© The Author(s) 2022.
PY - 2024/8
Y1 - 2024/8
N2 - We examine the factors that explain the underwriting decision and underwriting fees for Australian initial public offerings (IPOs). Using a sample of Australian IPOs, spanning the period 1999–2019, we document the following results. IPOs that allow oversubscription of the shares, bookbuild offers, and IPOs with a greater delay to listing, are less likely to be underwritten. We also find that more prestigious underwriters are associated with greater IPO underpricing, while charging lower percent underwriting fees. Prestigious underwriters capture side benefits associated with their reputational status by offering their clients or favoured investors with discounted shares. JEL Classification: G12, G19, G38.
AB - We examine the factors that explain the underwriting decision and underwriting fees for Australian initial public offerings (IPOs). Using a sample of Australian IPOs, spanning the period 1999–2019, we document the following results. IPOs that allow oversubscription of the shares, bookbuild offers, and IPOs with a greater delay to listing, are less likely to be underwritten. We also find that more prestigious underwriters are associated with greater IPO underpricing, while charging lower percent underwriting fees. Prestigious underwriters capture side benefits associated with their reputational status by offering their clients or favoured investors with discounted shares. JEL Classification: G12, G19, G38.
KW - Australian Securities Exchange
KW - bookbuild
KW - initial public offerings
KW - underwriting
UR - http://www.scopus.com/inward/record.url?scp=85144189611&partnerID=8YFLogxK
U2 - 10.1177/03128962221139728
DO - 10.1177/03128962221139728
M3 - Article
AN - SCOPUS:85144189611
SN - 0312-8962
VL - 49
SP - 403
EP - 427
JO - Australian Journal of Management
JF - Australian Journal of Management
IS - 3
ER -