The Impact of Foreign Strategic and Corporate Investors on H-Share IPO Performance

Paul Brockman; Louis T. W. Cheng; Tak Y. Leung

doi:10.1111/ajfs.12156

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The Impact of Foreign Strategic and Corporate Investors on H-Share IPO Performance

Journal article

Peer reviewed

The Impact of Foreign Strategic and Corporate Investors on H-Share IPO Performance

Paul Brockman, Louis T. W. Cheng and Tak Y. Leung

Asia-Pacific Journal of Financial Studies, Vol.45(6), pp.886-915

2016

DOI: https://doi.org/10.1111/ajfs.12156

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Abstract

corporate investor

foreign institutional investor

H-shares

IPO

strategic investor

Since 1993, foreign institutional investors (strategic and corporate) have been permitted to invest in Chinese companies listed in Hong Kong as H-shares. We examine the impact of strategic and corporate investors on H-shares before, during, and after their IPOs. We observe that strategic and corporate investors select their investment candidates based on specific pre-IPO firm characteristics. The certification effect of corporate investors generates a significantly positive effect on outside investor demand. In addition, the presence of foreign institutional investors, particularly strategic investors, and post-IPO performance are positively related. Overall, we document a positive effect of foreign institutional investors on H-firms.

Details

Title: The Impact of Foreign Strategic and Corporate Investors on H-Share IPO Performance
Authors: Paul Brockman (Author) - Lehigh University
Louis T. W. Cheng (Corresponding Author) - Hong Kong Polytechnic University
Tak Y. Leung (Author) - Open University of Hong Kong
Publication details: Asia-Pacific Journal of Financial Studies, Vol.45(6), pp.886-915
Publisher: Wiley-Blackwell Publishing Ltd.
DOI: 10.1111/ajfs.12156
ISSN: 2041-6156
Grant note: 145608 / Research Grants Council of the Hong Kong Special Administrative Region, China; Hong Kong Research Grants Council 1-ZV3R / School of Accounting and Finance of Hong Kong Polytechnic University
Organisation Unit: School of Business and Creative Industries
Language: English
Record Identifier: 99710572202621
Output Type: Journal article

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Collaboration types: Domestic collaboration; International collaboration
Web Of Science research areas: Business, Finance

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