Publication Type
Journal Article
Version
publishedVersion
Publication Date
6-2009
Abstract
We show that investor recognition and bonding associated with a U.S. cross-listing are distinct effects using a sample of Canadian firms. In contrast to the post-listing decline documented in the literature, we find that cross-listed firms with a single class of shares enjoy a permanent increase in valuation if they attract and maintain investor recognition over time. Valuations of firms that fail to widen their U.S. shareholder base return to pre-listing levels within two years. Cross-listed firms with dual-class shares exhibit a permanent increase in valuation regardless of the level of U.S. investor holdings, consistent with firm-level bonding.
Keywords
equity valuation, international cross-listing, investor recognition, institutional investors, ownership structure
Discipline
Accounting | Corporate Finance
Research Areas
Financial Performance Analysis
Publication
Review of Financial Studies
Volume
22
Issue
6
First Page
2393
Last Page
2421
ISSN
0893-9454
Identifier
10.1093/rfs/hhn050
Publisher
Oxford University Press
Citation
KING, Michael R. and SEGAL, Dan.
The long-term effects of cross-listing, investor recognition, and ownership structure on valuation. (2009). Review of Financial Studies. 22, (6), 2393-2421.
Available at: https://ink.library.smu.edu.sg/soa_research/803
Copyright Owner and License
Publisher
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/10.1093/rfs/hhn050