Publication Type
Journal Article
Version
acceptedVersion
Publication Date
2-2005
Abstract
This paper examines the relationship between ownership structures and IPO long-run performance of non-SOEs in China. Although non-SOEs underperform the market in general after IPO but the poor performance is mainly caused by the IPOs with ownership control wedge. Non-SOEs with one share one vote structure outperform those with control-ownership wedge by 30% for three years post-IPO performance in adjusted buy-and-hold returns. Non-SOEs with control-ownership wedge have higher frequency of undertaking value-destroying related party transactions. These findings suggest that non-SOEs need to improve corporate governance such as disproportionate ownership structure to better safeguard the interest of long-run shareholders.
Keywords
IPO, Initial Public Offering, Long-run performance, Disproportionate ownership, Non-SOEs firms, China
Discipline
Asian Studies | Business | Corporate Finance
Research Areas
Finance
Publication
China Economic Review
Volume
32
First Page
27
Last Page
42
ISSN
1043-951X
Identifier
10.1016/j.chieco.2014.11.004
Publisher
Elsevier
Citation
WANG, Xiaoming; CAO, Jerry; TANG, Jinghua; and TIAN, Gary Gang.
Disproportionate ownership structure and IPO long-run performance of non-SOEs in China. (2005). China Economic Review. 32, 27-42.
Available at: https://ink.library.smu.edu.sg/lkcsb_research/4360
Copyright Owner and License
Authors
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Additional URL
https://doi.org/10.1016/j.chieco.2014.11.004