State ownership and IPO valuation : A signaling perspective on the transition economy of China
Research output: Chapters, Conference Papers, Creative and Literary Works (RGC: 12, 32, 41, 45) › 32_Refereed conference paper (with ISBN/ISSN) › peer-review
Author(s)
Detail(s)
| Original language | English |
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| Title of host publication | Academy of Management 2010 Annual Meeting - Dare to Care: Passion and Compassion in Management Practice and Research, AOM 2010 |
| Publication status | Published - 2010 |
| Externally published | Yes |
Conference
| Title | 70th Annual Meeting of the Academy of Management - Dare to Care: Passion and Compassion in Management Practice and Research, AOM 2010 |
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| Place | Canada |
| City | Montreal, QC |
| Period | 6 - 10 August 2010 |
Link(s)
| Permanent Link | https://scholars.cityu.edu.hk/en/publications/publication(4952da37-e8ae-4561-a824-a0268400ba24).html |
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Abstract
This study examines the relationship between state ownership and IPO valuation in transition economies. Because the state often retains significant ownership after an IPO, which negatively impacts IPO valuation, we argue from signaling theory that the government may strategically allocate shares to different types of institutional investors to convey positive signals such that IPO valuation can be improved. We contend that share allocation to various types of institutional investors signals different information to public investors in transition economies, and hence moderating the relationship between state ownership and IPO valuation differently. Using a sample of 499 IPOs between 1999 and 2004 in China, we found that state ownership is negatively related to IPO valuation; however, such relationship is moderated by shares allocation to strategic investors, investment funds, and legal persons.
Research Area(s)
- Institutional investors, IPO, State ownership
Citation Format(s)
State ownership and IPO valuation : A signaling perspective on the transition economy of China. / Wan, William P.; Yiu, Daphne W.; Wang, Xiaodan Abby.
Academy of Management 2010 Annual Meeting - Dare to Care: Passion and Compassion in Management Practice and Research, AOM 2010. 2010.Research output: Chapters, Conference Papers, Creative and Literary Works (RGC: 12, 32, 41, 45) › 32_Refereed conference paper (with ISBN/ISSN) › peer-review
