Abstract
<p><em>The study investigates information asymmetry between security issuers and other market participants. Investors and entrepreneurs require reliable information about the firms. Therefore, it is crucial to examine how the top management information can be communicated to other market participants. The empirical implications of the model are tested on the set of 28 of 89 Indonesian firms that made an initial public offering in 2013-2016. The asymmetry problem is most significant when a firm makes a first public issue. Furthermore, the study explains the number of shares retained by the entrepreneur as a signal of IPO firm value. The test results are generally consistent with the signaling model's predictions, while the role of the controlling variables does not support the firm value.</em></p><p><strong><em>Keywords: </em></strong><em>Ownership-Retention, Firm</em> <em>Value, Initial Public Offering, IPO</em></p><p><em> </em></p>
Highlights
A company to develop its business must have a decision to increase capital, either by borrowing money or issuing shares in the capital market
Ownership-retention is measured by the number of new shares issued after the previous owner divided by the total number of shares issued after the Initial Public Offering (IPO) (Fan Qintao, 2007), which can be formulated as follows: Description: N before N secondary N after
The intellectual capital (X2) variable shows a minimum value of -2.74 from Siloam International Hospitals Tbk (SILO) company
Summary
A company to develop its business must have a decision to increase capital, either by borrowing money or issuing shares in the capital market. Ownership retention is the percentage of the old owner's shares that the old owners still retain after the company made an initial public offering (Widarjo, 2010). Initial public offerings have information that is not symmetric between the old owners of the company and shareholders. The signal conveyed by the old owner will provide information to shareholders to find out the company's prospects in the future. The above research is used as the basis by the author to research with the title " Ownership Retention and The Value Of Initial Public Offering (IPO) Firms In 2013-2016”. Unbalanced information about the company's prospects occurs between prospective shareholders and the company's former owners when conducting an initial public offering of shares in the capital market. Actions that the old owner of the company will take to communicate information to potential investors are called signals. A positive signal from the company can be expected to get a positive response from the market and provide competitive profits for the company and benefit investors
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