The Cost of Raising Capital and Issue Size Effects - The Case of Initial Public Offerings in Germany

Kaserer, Christoph; Kraft, Marcus

doi:10.2139/ssrn.236176

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“…29 These companies have been MSH International Services AG (book-building range/issuing price: € 18.50-21.50 / € 15.50) and Euromed AG (€ 10.50-13.50 / € 9.00). 30 LJUNGQVIST /JENKINSON (2000) merely conject that local regulations, the costs caused by price revisions or the market power of domestic investors could serve as explanations for the unwillingness to raise the price. 31 For a cross-sectional analysis of the costs of raising capital in Germany, see: KASERER/KRAFT (2000).…”

Section: Venture Capital Financing In Germanymentioning

confidence: 99%

Underpricing of Venture-Backed and Non Venture-Backed Ipos: Germany’s Neuer Markt

Franzke¹

Advances in Financial Economics

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This paper analyzes a comprehensive data set of 108 non venture-backed, 58 venture-backed and 33 bridge financed companies going public at Germany's Neuer Markt between March 1997 and March 2000. I examine whether these three types of issues differ with regard to issuer characteristics, balance sheet data or offering characteristics. Moreover, this empirical study contributes to the underpricing literature by focusing on the complementary or rather competing role of venture capitalists and underwriters in certifying the quality of a company when going public. Companies backed by a prestigious venture capitalist and/or underwritten by a top bank are expected to show less underpricing at the initial public offering (IPO) due to a reduced ex-ante uncertainty. T his study provides evidence to the contrary: VC-backed IPOs appear to be more underpriced than non VCbacked IPOs.

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Section: Venture Capital Financing In Germanymentioning

confidence: 99%

Underpricing of Venture-Backed and Non Venture-Backed Ipos: Germany’s Neuer Markt

Franzke¹

Advances in Financial Economics

View full text Add to dashboard Cite

show abstract

The Cost of Raising Capital and Issue Size Effects - The Case of Initial Public Offerings in Germany

Cited by 1 publication

References 0 publications

Underpricing of Venture-Backed and Non Venture-Backed Ipos: Germany’s Neuer Markt

Underpricing of Venture-Backed and Non Venture-Backed Ipos: Germany’s Neuer Markt

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