Abstract
PurposeThis study aims to investigate the relationship between the family generational stage and the intended use of the Initial Public Offering (IPO) proceeds disclosed in the prospectus. With the aim to explore family business (FB) heterogeneity, it also explores the moderating role of the family CEO.Design/methodology/approachWe draw on signalling theory and hand-collected data on Italian family IPOs that occurred in the period 2000–2020, disentangling the intended use of IPO proceeds as distinguished into three categories. We employ logit regression to test our hypotheses.FindingsAccording to our theoretical predictions, we find that the family generational stage positively affects the disclosure of the investment reason as the intended use of IPO proceeds, while it negatively influences the use for recapitalization and general corporate purposes. The first relationship is moderated by the presence of a family CEO. Our results remain robust with different FBs definitions and a different empirical method.Originality/valueTo the best of the authors’ knowledge, this paper is the first to address the topic of the intended use of IPO proceeds in FBs. In doing so, it opens avenues for future research by enriching an underdeveloped, albeit growing, area of research, that of preparing for the market scrutiny in family IPOs.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
