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Choice between backdoor listing and regular initial public offering in China

Shao, Chunxia LU (2017) NEKP03 20171
Department of Economics
Abstract
The essay examines the factors that affect the private firms’ choice to go public by backdoor listing (BDL) or regular initial public offering (IPO) in China. The relevant ex-ante factors are tested by 104 BDL firms and 449 IPO firms. The results indicate significant regulation impact to the firm’s decision. In the meantime, it is unclear that the review standard of firm’s profit affects the firm’s choice. The BDL is more prevalent at a hotter market, while IPO firms have less time flexibility because of the regulation. Due to the unclean shells and the intention of taking over the reorganized companies, the sizes of BDL firms are significantly larger than those of IPO firms. With a higher debt ratio and higher ratio of research and... (More)
The essay examines the factors that affect the private firms’ choice to go public by backdoor listing (BDL) or regular initial public offering (IPO) in China. The relevant ex-ante factors are tested by 104 BDL firms and 449 IPO firms. The results indicate significant regulation impact to the firm’s decision. In the meantime, it is unclear that the review standard of firm’s profit affects the firm’s choice. The BDL is more prevalent at a hotter market, while IPO firms have less time flexibility because of the regulation. Due to the unclean shells and the intention of taking over the reorganized companies, the sizes of BDL firms are significantly larger than those of IPO firms. With a higher debt ratio and higher ratio of research and development expenditure, the firms are likely to choose BDL. In addition, the asset liquidity and intangible asset ratio have less influence on the choice, although the firms with higher profitability tend to choose BDL in IPO periods. (Less)
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author
Shao, Chunxia LU
supervisor
organization
course
NEKP03 20171
year
type
H2 - Master's Degree (Two Years)
subject
keywords
backdoor listing, front-door listing, IPO, reverse takeover, reverse merger, M&A
language
English
id
8914488
date added to LUP
2017-06-13 14:45:48
date last changed
2017-06-13 14:45:48
@misc{8914488,
  abstract     = {The essay examines the factors that affect the private firms’ choice to go public by backdoor listing (BDL) or regular initial public offering (IPO) in China. The relevant ex-ante factors are tested by 104 BDL firms and 449 IPO firms. The results indicate significant regulation impact to the firm’s decision. In the meantime, it is unclear that the review standard of firm’s profit affects the firm’s choice. The BDL is more prevalent at a hotter market, while IPO firms have less time flexibility because of the regulation. Due to the unclean shells and the intention of taking over the reorganized companies, the sizes of BDL firms are significantly larger than those of IPO firms. With a higher debt ratio and higher ratio of research and development expenditure, the firms are likely to choose BDL. In addition, the asset liquidity and intangible asset ratio have less influence on the choice, although the firms with higher profitability tend to choose BDL in IPO periods.},
  author       = {Shao, Chunxia},
  keyword      = {backdoor listing,front-door listing,IPO,reverse takeover,reverse merger,M&A},
  language     = {eng},
  note         = {Student Paper},
  title        = {Choice between backdoor listing and regular initial public offering in China},
  year         = {2017},
}