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From setback to comeback: Motivations for withdrawn IPO firms to return

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  • Chen, Gaole
  • Sutton, Ninon
  • Qi, Jianping

Abstract

Are withdrawn IPOs that return to the market driven by the same acquisition motive as first-time IPOs? We examine the investment decisions of second-time IPO firms after successfully going public. Our findings show that, contrary to first time IPOs, second-time IPOs are not active acquirers and spend significantly more on CAPEX and R&D than first-time IPOs. Unlike acquisitions in the post-IPO period, CAPEX and R&D spending benefit second-time IPOs’ long run performance.

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  • Chen, Gaole & Sutton, Ninon & Qi, Jianping, 2017. "From setback to comeback: Motivations for withdrawn IPO firms to return," The Quarterly Review of Economics and Finance, Elsevier, vol. 66(C), pages 259-264.
    • Handle: RePEc:eee:quaeco:v:66:y:2017:i:c:p:259-264
    DOI: 10.1016/j.qref.2017.03.002
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    Cited by:

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    2. Boeh, Kevin K. & Dunbar, Craig G., 2021. "Raising capital after IPO withdrawal," Journal of Corporate Finance, Elsevier, vol. 69(C).
    3. Hai Long & Xiaochen Lin & Yu Chen, 2021. "Why the Operating Performance of Post-IPO Firms Decreases: Evidence from China," JRFM, MDPI, vol. 14(9), pages 1-15, September.
    4. Helbing, Pia, 2019. "A review on IPO withdrawal," International Review of Financial Analysis, Elsevier, vol. 62(C), pages 200-208.

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    Keywords

    IPO; M&A; CAPEX; R&D; Withdraw; Return;
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