Work

The Timing of Voluntary Delisting

Year: 2019

Type: article

Abstract: For many firms, voluntarily delisting from a stock exchange can be optimal. We model an entrepreneur's incentives to voluntarily delist the firm as a trade-off between consumption of private benefits when listed and expected improvements in the firm's performance after delisting. Our model allows for heterogeneity across firms and countries, and various micro and macro shocks affect the delisting decision. Such a model makes novel predictions regarding the delisting patterns around the world. We empirically confirm these predictions using manually collected delisting data from 26 countries. Increasing policy and regulatory uncertainties can partially explain the greater popularity of voluntary delistings.

Source: Journal of Financial Economics

DOI: 10.1016/j.jfineco.2024.103832

Authors: Alcino Azevedo, Gonul Colak, Izidin El Kalak, Radu Tunaru

Institutions: Aston University, University of Sussex, Hanken School of Economics, Cardiff University

Language: English

Topic: Corporate Finance and Governance

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

Open Access status: hybrid

Estimated APC paid: $1,800

OpenAlex ID: W4393854592

FWCI:

Cites: 101

Cited by: 19

Related to: 10