Many issuers have doubts about the efficiency of the IPO market, despite post-2008 regulations designed to reduce conflicts of interests and the costs of going public. As a result, fewer companies are choosing to be listed, and many of those that do go public hire independent advisers to gain peace of mind throughout the process.
In our new paper, we ask whether such advisers reduce IPO underpricing and whether issuing firms benefit from greater certainty of execution or lower total fees. We concentrate our analysis on the three leading IPO advisers in Europe (Rothschild, Lazard and STJ Advisors), … Read more
Shareholder activism is growing in popularity across the world and appears to deliver mostly benign results for firms and stockholders. However, testing the effects of activism is problematic. For at least 30 years, researchers have recognized the difficulty of causal inference when examining ownership and performance. Perhaps activists systematically target firms that are poised to improve anyway or select liquid stocks to cheaply acquire blocks. Despite a body of empirical evidence on the positive effects of activism, critics continue to warn of dangers: Activists hunt in highly-motivated and well-resourced wolf packs that exploit regulatory loopholes; they focus on short-term financial … Read more