The market reaction to international cross-listings : evidence of managerial timing.

Klease, Drew. (2003). The market reaction to international cross-listings : evidence of managerial timing. Honours Thesis, School of Business, The University of Queensland.

       
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Author Klease, Drew.
Thesis Title The market reaction to international cross-listings : evidence of managerial timing.
School, Centre or Institute School of Business
Institution The University of Queensland
Publication date 2003
Thesis type Honours Thesis
Total pages 82
Language eng
Subjects 1503 Business and Management
Formatted abstract This thesis examines the market reaction to international cross-listings undertaken by Australian companies. Cross-listing firms perform strongly prior to listing, but following listing they suffer a significant returns decline. The post-listing decline is examined after controlling for size and book-to-market effects, and the results reveal that the decline persists for 450 days after listing. The short-term market reaction following a listing on a major stock exchange is positive, and consistent with the segmentation, investor awareness and liquidity hypotheses. The post-listing returns decline is not simply driven by the underperformance of firms that simultaneously issue equity in conjunction with their listing. Similar to the conclusions regarding other long run phenomena, the post-listing decline appears to be related to managers timing the listing decision, as small firms experience a significant post-listing decline, whereas no significant decline is observed for large firms. The post-listing decline is only significant for firms listing on the 'unofficial regulated market' on the Berlin Bremen Stock Exchange, or which commence trading in the U.S. over-the-counter market. This evidence provides limited support for the managerial timing proposition, as there exists no initial listing requirements for firms to commence trading in these markets.

 
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Created: Tue, 16 Nov 2010, 12:38:27 EST by Muhammad Noman Ali on behalf of The University of Queensland Library