Board Composition, Share Ownership and "Underpricing" of U.K. IPO Firms

I Filatotchev; K Bishop

doi:10.1002/smj.269

Board Composition, Share Ownership and "Underpricing" of U.K. IPO Firms

I Filatotchev, K Bishop

King's College London

Research output: Contribution to journal › Article › peer-review

309 Citations (Scopus)

Abstract

Using a sample of 251 IPOs in the United Kingdom, this paper examines interlinks between executive and nonexecutive characteristics, share ownership, and short-term performance measured in terms of share offer underpricing. It argues that executives' power and previous experience directly affect ex ante choice of nonexecutive directors and their ownership interests in the firm. These endogenously developed governance factors may be used by IPO teams strategically to reduce the extent of underpricing. However, there is a selective response of investors to different board characteristics and share ownership structure.

Original language	English
Pages (from-to)	941 - 956
Number of pages	16
Journal	STRATEGIC MANAGEMENT JOURNAL
Volume	23
Issue number	10
DOIs	https://doi.org/10.1002/smj.269
Publication status	Published - Oct 2002

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10.1002/smj.269

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Board Composition, Share Ownership and "Underpricing" of U.K. IPO Firms

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