Three Essays on Multiple Lead Underwriters in IPOS
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Author(s)
Primary Supervisor
Neupane, Suman
Chung, Richard Yiu-Ming
Year published
2017
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The objective of this thesis is to investigate the role of multiple lead underwriter (MLU) syndicates in initial public offerings (IPOs). Despite the increasing tendency among US issuers to employ MLUs to manage their offerings, the role of MLUs has not been widely recognised in the IPO literature. Using a sample of US IPOs from 1999–2012, this thesis explores several roles of MLUs in three related yet distinct empirical essays. In the first empirical essay, we investigate the information production role of underwriters in an MLU syndicate. We find that, compared to SLU-backed IPOs, MLU-backed IPOs contain more informative ...
View more >The objective of this thesis is to investigate the role of multiple lead underwriter (MLU) syndicates in initial public offerings (IPOs). Despite the increasing tendency among US issuers to employ MLUs to manage their offerings, the role of MLUs has not been widely recognised in the IPO literature. Using a sample of US IPOs from 1999–2012, this thesis explores several roles of MLUs in three related yet distinct empirical essays. In the first empirical essay, we investigate the information production role of underwriters in an MLU syndicate. We find that, compared to SLU-backed IPOs, MLU-backed IPOs contain more informative content in their IPO prospectuses. The level of informative content, which is a proxy for pre-filing the due diligence efforts of lead underwriters, suggests that MLUs produce more information during the pre-filing period. Further, we find that MLUs use a more readable writing style in IPO prospectuses to effectively communicate pre-filing information to investors. We also find that MLUs produce less information during bookbuilding and provide less support for partial adjustment phenomena. Together, our results suggest that MLUs replace the costly process of bookbuilding information production with their extensive pre-filing information production.
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View more >The objective of this thesis is to investigate the role of multiple lead underwriter (MLU) syndicates in initial public offerings (IPOs). Despite the increasing tendency among US issuers to employ MLUs to manage their offerings, the role of MLUs has not been widely recognised in the IPO literature. Using a sample of US IPOs from 1999–2012, this thesis explores several roles of MLUs in three related yet distinct empirical essays. In the first empirical essay, we investigate the information production role of underwriters in an MLU syndicate. We find that, compared to SLU-backed IPOs, MLU-backed IPOs contain more informative content in their IPO prospectuses. The level of informative content, which is a proxy for pre-filing the due diligence efforts of lead underwriters, suggests that MLUs produce more information during the pre-filing period. Further, we find that MLUs use a more readable writing style in IPO prospectuses to effectively communicate pre-filing information to investors. We also find that MLUs produce less information during bookbuilding and provide less support for partial adjustment phenomena. Together, our results suggest that MLUs replace the costly process of bookbuilding information production with their extensive pre-filing information production.
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Thesis Type
Thesis (PhD Doctorate)
Degree Program
Doctor of Philosophy (PhD)
School
Griffith Business School
Copyright Statement
The author owns the copyright in this thesis, unless stated otherwise.
Subject
Initial public offerings
Underwriters