The IPO Decision: Why and How Companies Go Public

Initial public offerings (IPOs) garnered unprecedented positive attention in the 1990s for their spectacular returns and central role in entrepreneurial activity. Subsequent revelations of unscrupulous IPO allocation and promotion practices cast a less favorable shadow. The IPO Decision is an exciting new text that separates fact from fiction by imposing a logical structure on the most up-to-date IPO-related research, clarifying how the IPO process actually works. The first half of the book examines the motives for why and when companies decide to go public, including timing, financial, strategic, and control considerations. The second half provides an in-depth review of the IPO process, focusing on the underwriter, the valuation, pricing and allocation of shares, and the aftermarket performance. Unparalleled in its scope, the book presents the findings from theoretical and empirical research in a rigorous yet accessible manner. Scholars, students and industry professionals interested in the economics of IPOs will find this volume a comprehensive and engaging addition to their library.