A Theory of IPO Pricing using Tender Prices
Initial Public Offerings (IPOs) are an integral part of market capitalization, and the pricing of such offerings have been theorized considerably. New methods of IPOs often bring new insights to existing theories. This paper studies a new form of IPO with French tenders, and proposes an information theory to explain the strike price and the listing price premia. An outcome of the model is that it shows how informed investors' excess returns in traditional IPOs may be dissipated under competitive French tendering. [ABSTRACT FROM AUTHOR]
Finance and Financial Management | Portfolio and Security Analysis
Applied Financial Economics
Taylor and Francis
Lim, Kian Guan and Ng, Edward H. K..
A Theory of IPO Pricing using Tender Prices. (1999). Applied Financial Economics. 9, (5), 433-442. Research Collection Lee Kong Chian School Of Business.
Available at: https://ink.library.smu.edu.sg/lkcsb_research/2266