Do Spanish IPO Firms Fit the Continental European Model for Going Public?
REFC – Spanish Journal of Finance and Accounting, doi.org/10.1080/02102412.2019.1650238
Posted: 2 Aug 2019 Last revised: 5 Sep 2019
Date Written: July 26, 2019
This paper analyses the determinants of the going public decision of the non-financial firms that were listed in the Spanish Continuous Market through an Initial Public Offering of shares (IPO) in the period 1997-2013. We employ series of characteristics related to the firms and the economic environment and logit regression methods in order to find the model that best fits the firms that went public, using the firms that could have gone public in the same period, but opted not to, as a control sample. In Spain, the firms that went public were characterized by being relatively larger and riskier than those that did not. In addition, their IPOs came after a period of investment and growth, although it does not appear that they intended to rebalance their financial structure or reduce their financial costs. Likewise, our results are robust across different sensitivity analyses. Our results suggest that Spanish IPO firms do not fit the Continental European model for going public. Therefore, it seems that differences between the Continental European and the Anglo-Saxon model are fading.
Keywords: Initial Public Offerings (IPO), going public decision, Spanish stock market
JEL Classification: C35, G32
Suggested Citation: Suggested Citation