The Motivation for IPOs：Empirical study on Taiwan Emerging Stock Market
Date Issued
2016
Date
2016
Author(s)
Huang, Yen-Hsiang
Abstract
This paper examined the motivation of initial public offering (IPO) activities with 2005-2015 Taiwan Companies which had listed in Emerging Stock Market. Compared to foreign stock market, scholar can take advantage of the regulation for Taiwan stock market. That is, with the establishment of Emerging Stock Market, it is more convenient for research to identify companies willing to go public. Related data such as ownership structure before IPO is more sufficient as well. In this study, industrial variables, ownership variables, voting right related variables, and fundamental variables are the focus. Factor analysis will be conducted among those variables. Based on common factor extracted with factor analysis, this paper forms few multiple regression models for IPO motivation. The feature of this paper is the focus on voting right variables. In order to define the insiders who push IPO events, I tried to remove the seats for zero stockholding insiders. Removed insiders are independent director mostly, and their role in BOD is to examine the proposal. Since this paper focus on IPO motivation, it is reasonable to remove insider who doesn’t raise the IPO proposal. After controlling the fundamental variables, I find monitor factor and voting right related factor both have negative effect on IPO dummy variables significantly. As conclusion, this study find enterprises are more willing to go public if the stockholding of unaffiliated blockholder is lower and the voting right held by insider who making decision is lower.
Subjects
IPO Motivation
Factor Analysis
Ex ante Regression
Ownership Structure
Voting Right Structure
Type
thesis
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