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Artículo en revista académica

calendar_month Publicación: 01/07/2024

Ownership Concentration and Firm Value: New Evidence from Owner Stakes in IPOs

Autor: Borja Larraín, Peter Roosenboom, Giorgo Sertsios, Francisco Urzua

We study the relationship between ownership concentration and firm value using hand-collected data on the stakes of owner–managers before and after initial public offerings (IPOs). We instrument for the reduction in stake using market returns shortly before IPOs. Short-run market returns are plausible instruments because owners engage in market timing by selling more when prior returns are high, but high short-run returns are unlikely to directly affect firm value years after the IPO. As predicted by agency theory, a large reduction in ownership concentration at the IPO is negatively related to valuation. Future asset growth is low when owners have low stakes.

Fuente: Management Science

Vol. 70, Issue 7, pag. 4441-4464

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