This paper investigates the effect of Korean conglomerate (a.k.a. Chaebol) on the performance of initial public offering firms in a sample of 96 conglomerate-backed IPOs and 603 non-conglomerate-backed IPOs from 2001 to 2008. Inconsistent with prior studies of venture capital effect on IPO, I report no evidence of conglomerate effect on short-run underpricing. Similarly, in the test of performance over 1 year, significant difference is not observed between conglomerate-backed firms and non-conglomerate-backed firms.
This paper investigates the effect of Korean conglomerate (a.k.a. Chaebol) on the performance of initial public offering firms in a sample of 96 conglomerate-backed IPOs and 603 non-conglomerate-backed IPOs from 2001 to 2008. Inconsistent with prior studies of venture capital effect on IPO, I report no evidence of conglomerate effect on short-run underpricing. Similarly, in the test of performance over 1 year, significant difference is not observed between conglomerate-backed firms and non-conglomerate-backed firms.
