- Copyright Page
- The Law and Economics of the Going-Public Decision
- IPO Regulators Gone Wild
- Determinants of Variation in IPO Underpricing
- IPO Valuation: The International Evidence
- Survey and Synthesis of the IPO Underpricing Literature: The Fixed-Offer Price Constraint as a Unifying Core Explanation
- IPO Market Conditions and Timing over the Long Run
- The Interplay of IPO and M&A Markets: The Many Ways That One Affects the Other
- Lower Visibility Platforms Serving as Stepping Stones to National Stock Exchanges: The Case of Shell Reverse Mergers
- Going Public in China: Reverse Mergers versus IPOs on Chinese Markets
- Specified Purpose Acquisition Company IPOs
- The Impact of IPOs’ Analyst Coverage on the Choice and Timing of SEOs: A Survival Analysis
- Auditor Selection and IPO Underpricing
- The Structure and Role of the Underwriting Syndicate
- Venture Capital and Financial Reporting in Newly Public Firms
- The Dark Side of Venture Capital Syndication and IPO Firm Performance: The Impact of Different Institutional Environments
- All Ties Are Not Created Equal: Institutional Equity Ties, IPO Performance, and Market Growth of New Ventures
- Is Exchange Regulation Effective for Junior Public Equity Markets?
- Corporate Governance in European IPOs
- Survival of Initial Public Offerings on Europe’s New Stock Markets
- Initial Public Offerings in Germany between 1997 and 2015
- The Underpricing of Initial Public Offerings and Private Placements of Equity in China
- IPOs in New Zealand: An Analysis of Benchmark-Adjusted Performance
- Initial Public Offerings in Hong Kong
- The Admission and Regulation of Overseas Issuers: A Survey of the Top Four Financial Centers
- IPOs in a Major Emerging Market Economy—India
- Private Capital Marketplaces and IPOs
- Crowdfunding: Business and Regulatory Perspective
- Regulatory Arbitrage in Cross-Border Crowdfunding
Abstract and Keywords
This chapter provides an analysis of companies undertaking a reverse merger (RM) as opposed to an initial public offering (IPO) on Chinese stock markets. It introduces a new data set of RMs on Chinese exchanges to examine the financial characteristics of firms that choose an RM over an IPO. The authors find that Chinese RM firms have lower liquidity, higher leverage, and lower asset turnover than firms that go public through an IPO. Promoters of Chinese RM firms also hold more shares as compared with IPOs. Finally, Chinese RM firms have higher return on assets and lower underpricing at listing. The results identify several characteristics of Chinese RM firms that differentiate them from firms that go public via an RM in Western markets, suggesting that Chinese institutions and stage of stock market development may impact the decision to go public.
Zijian Cheng is a Lecturer in Accounting at the Business School of Shandong University, Weihai.
Continuity Capital Partners Pty Ltd
Zhangxin (Frank) Liu is Assistant Professor of Accounting and Finance at University of Western Australia Business School.
Access to the complete content on Oxford Handbooks Online requires a subscription or purchase. Public users are able to search the site and view the abstracts and keywords for each book and chapter without a subscription.
If you have purchased a print title that contains an access token, please see the token for information about how to register your code.