Handbook of Research on IPOs
Show Less

Handbook of Research on IPOs

  • Elgar original reference

Edited by Mario Levis and Silvio Vismara

The Handbook of Research on IPOs provides a comprehensive review of the emerging trends and directions in the global initial public offerings (IPO) markets. The empirical evidence included in the book covers Europe, the US and the Far East, and presents a truly global perspective of IPO markets around the world and at the different stages of the entire IPO process.
Buy Book in Print
Show Summary Details

Chapter 14: Do directors trade after IPO lockup expiry?

Susanne Espenlaub, Marc Goergen, Arif Khurshed and Marko Remenar

Extract

On 16 August 2012, Facebook’s first lockup ended and more than 271 million shares became eligible for trading. The Wall Street Journal reported that, by 3.30 p.m. (New York time), more than 141 million shares had traded. This was three times the daily average over the last 30 days. By 4.00 p.m., Facebook’s share price had fallen to $19.87, a drop of nearly 6.3 per cent compared with the closing price on the previous day. The press speculated that the reason for the fall in Facebook’s share price was that some of the directors and early investors were expected to sell their holdings. This speculation proved to be correct. Peter Thiel, one of the directors of Facebook, sold 20.1 million shares when the lockup expired. More generally, do directors of initial public offering (IPO) firms trade when lockups expire, and is their trading accompanied by a drop in the share price? In this chapter we answer this question by studying the trading behaviour of directors of 233 UK IPOs that came to the market during 1992–98.

You are not authenticated to view the full text of this chapter or article.

Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.

Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.

Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.


Further information

or login to access all content.