Business, Management and Accounting
4 years ago

Institutions Prefer IPOs with Ownership Changes Over Fundraising.

SSRN Electronic Journal
What Determines Institutional Investors’ Holdings in IPO Firms?
Allen Michel, Jacob Oded, Israel Shaked

Paper Summary

Institutional investors prefer investing in IPO firms with a higher public float, indicating a change in ownership structure. They are not influenced by whether the IPO is for fundraising or owner value liquidation. Pre-IPO operating performance does not impact institutional investment decisions. Additionally, institutions tend to invest more in value firms rather than growth firms.

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