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- Title
Do Privatization IPOs Outperform in the Long Run?
- Authors
Choi, Seung-Doo; Lee, Inmoo; Megginson, William
- Abstract
This paper investigates the long-run stock returns of privatization initial public offering (IPO) firms using a sample of 241 privatization IPOs from 42 countries during the period 1981-2003. We compare one-, three-, and five-year holding period returns of privatization IPOs to those of the domestic stock market indices and to size and size- and book-to-market equity ratio (BM)-matched firms from the same countries. Consistent with previous studies, we find that privatization IPOs significantly outperform their domestic stock markets in the long run. However, they show less consistent abnormal long-term stock performance relative to their size or size- and BM-matched benchmark firms.
- Subjects
GOING public (Securities); PRIVATIZATION; STOCKS (Finance); STOCK exchanges; RATE of return; PROFITABILITY; PROFIT; BUSINESS enterprises; COUNTRIES
- Publication
Financial Management (Wiley-Blackwell), 2010, Vol 39, Issue 1, p153
- ISSN
0046-3892
- Publication type
Article
- DOI
10.1111/j.1755-053X.2010.01069.x