- 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
Using a proprietary, recent shell reverse mergers (SRMs) sample, we analyze the financial profiling, financing event specifics, disclosure levels, and governance schemes of the private companies that are quoted on lower visibility platforms. We examine SRMs forward in time and identify a unique sample of SRMs that is successful getting upgraded to main U.S. stock exchanges. We report their financial characteristics and how they differ from the SRMs that do not manage to get upgraded. Further, we delve into the pricing, source of financing, and contractual terms of PIPE transactions that constitute their main capital raising events. We also note any differences in the financing and governance characteristics surrounding SRM firm listing changes. Our study contributes to the empirical going public literature by identifying the determinants of successful companies within lower visibility platforms and by justifying the necessity of the private secondary market’s existence.
Joseph J. Cecala, Jr., is the Founder and CEO of the Dream Exchange, LLC.
Ioannis V. Floros is Assistant Professor of Finance at the University of Wisconsin-Milwaukee, Lubar school of Business.
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