The Impact of JOBS Act on M&As

64 Pages Posted: 14 Jan 2020 Last revised: 28 Jul 2020

See all articles by Jitendra Aswani

Jitendra Aswani

Fordham University

Sudip Gupta

Johns Hopkins University

Iftekhar Hasan

Fordham University ; Bank of Finland; University of Sydney

Anthony Saunders

New York University - Leonard N. Stern School of Business

Date Written: May 31, 2018


Do changes in the IPO regulatory environment affect private firms’ exit choices, bargaining abilities, and valuations? Using the JOBS Act as an exogenous shock to the exit decisions among private firms, we observe that their valuations as M&A targets increase by 36% after the Act, negatively affecting acquirer wealth gains. These results are more prominent for VC-backed targets. We also find that stock (cash) deals decrease (increase) for private firms after the Act. Our results are robust to endogeneity concerns, alternative measures, placebo tests, and other robustness tests.

Keywords: JOBS Act, Bargaining Power, Exit Strategy, Corporate Valuation

JEL Classification: G24, G32, G34

Suggested Citation

Aswani, Jitendra and Gupta, Sudip and Hasan, Iftekhar and Saunders, Anthony, The Impact of JOBS Act on M&As (May 31, 2018). NYU Stern School of Business, Available at SSRN: or

Jitendra Aswani

Fordham University ( email )

113 West 60th Street
Bronx, NY 10458
United States
9176055492 (Phone)

Sudip Gupta (Contact Author)

Johns Hopkins University ( email )

Baltimore, MD 20036-1984
United States

Iftekhar Hasan

Fordham University ( email )

NEW YORK, NY 10023
United States

Bank of Finland ( email )

P.O. Box 160
Helsinki 00101

University of Sydney ( email )

P.O. Box H58
Sydney, NSW 2006

Anthony Saunders

New York University - Leonard N. Stern School of Business ( email )

44 West 4th Street
9-190, MEC
New York, NY 10012-1126
United States
212-998-0711 (Phone)
212-995-4220 (Fax)

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