The role of ‘cornerstone’ investors and the Chinese state in the relative underpricing of state- and privately controlled IPO firms

摘要: In recent years, China has partially privatized some of its most important state-owned enterprise companies. Hong Kong been host to the largest these issues and during five-year period, 2005–2009, more initial public offering (IPO) funds were generated through this market than any other. A key development in emergence ‘cornerstone’ investor agreements, which earmark stock allocations privileged parties immediate run-up prospectus release. This study offers a number contributions. First, after assessing characteristics such multivariate results point evidence positive association between presence agreements IPO returns. Second, Perotti (1995) model contention increased returns state-controlled entities fails garner support. Third, as an extension work on ‘political connections’ Chinese A-share issuers (Fan et al., 2007; Francis et al. 2009), po...