Abstract
We use textual analysis techniques to examine how the size of IPO lead underwriting syndicate influences the information production decisions of underwriters. Our results show that IPO prospectuses produced by multiple lead underwriters (MLUs) contain more informative content and use more readable language. These findings imply that MLUs produce and discloses more pricing information during the pre-filing period. We also find that MLUs produce less information during bookbuilding and provide less support for partial adjustment phenomenon. Together, our results suggest that MLUs can substitute the costly bookbuilding with the pre-filing information services.
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