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Student Number 964208020
Author Yu-tsung Shen(H)
Author's Email Address cloude0605@hotmail.com
Statistics This thesis had been viewed 924 times. Download 10 times.
Department Finance
Year 2008
Semester 2
Degree Master
Type of Document Master's Thesis
Language English
Title Do Underwriting Relationships Affect the Subsequent Underwriting Business?
Date of Defense 2009-06-23
Page Count 38
Keyword
  • Initial Public Offering
  • Underwriting Relationship
  • Abstract Our paper finds the effect of past underwriting relationship on the choice of future equity underwriter. We found that underwriting relationship is valuable for increasing the likelihood for future underwriting business from that issuer. Similarly, IPO underwriting relationship also increases the likelihood of winning future underwriting business. Moreover, we found that firms derive a value decrease from past underwriting relationships no matter in the short-run or in the long-run. However, IPO underwriting relationships do not create value for firms no matter in the short run or long run period.
    Table of Content Contents
    1 Introduction ............................................................................................................ 1
    2 Literature Review and Hypothesis Development .................................................. 3
    2.1 Literature Review ........................................................................................ 3
    2.2 Hypothesis Development ............................................................................ 5
    3 Data ........................................................................................................................ 6
    3.1 Data on Equity Issues .................................................................................. 6
    3.2 Construction of Relationship Measures ...................................................... 7
    4 Methodology .......................................................................................................... 9
    4.1 Logit Model for Underwriting Relationship ............................................... 9
    4.2 Measuring Short-run and Long-run Abnormal Returns ............................ 11
    4.2.1 Cumulative Abnormal Returns (CARs) ......................................... 11
    4.2.2 Buy and Hold Abnormal Returns (BHARs) .................................. 12
    4.2.3 Calendar Time Abnormal Returns (CTARs) .................................. 13
    5. Empirical Results ................................................................................................ 15
    5.1 The Benefits to Relationship of Underwriters Choices ............................ 15
    5.2 The Benefits of Relationship to Firms Performance ................................. 17
    5.2.1 Cumulative Abnormal Returns (CARs) ......................................... 17
    5.2.2 Buy and Hold Abnormal Returns (BHARs) .................................. 18
    5.2.3 Calendar Time Abnormal Returns (CTARs) .................................. 20
    6 Conclusion ........................................................................................................... 22
    References .................................................................................................................... 24
    Contents of Table
    Table 1: Calendar Time Distribution of Public Equity Issues ...................................... 26
    Table 2: Market share ranking of major equity underwriters ....................................... 27
    Table 3: Equity Underwriting Correlations across Different Relationship Measures.. 28
    Table 4: Impact of Underwriting Relationships on Probability of getting future equity
    underwriting business .................................................................................... 29
    Table 5: Impact of IPO Underwriting Relationships on Probability of Getting Future
    Equity Underwriting Business ....................................................................... 32
    Table 6: Cumulative Abnormal Returns (CARs) to Equity Issues on Underwriting
    Relationship ................................................................................................... 35
    Table 7: Buy and Hold Abnormal Returns (BHARs) to Equity Issues on Underwriting
    Relationship ................................................................................................... 36
    Table 8: Calendar-Time Post Event Monthly Abnormal Returns ................................ 37
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    Advisor
  • Keng-Yu Ho(Ѧt)
  • Jin-Huei Yeh(A)
  • Files
  • 964208020.pdf
  • disapprove authorization
    Date of Submission 2009-07-09

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