| My dissertation consists of three chapters. In the first chapter, I empirically analyze the role of institutional investors in corporate spin-offs, using a large sample of proprietary transaction-level institutional trading data. I find a significant imbalance in post-spin-off institutional trading between parents and subsidiaries. An examination on the underlying driving forces of the institutional trading imbalance finds support for the information production, pure play and risk management roles of institutional investors. Further analysis on the information production role of institutional investors suggest that institutional investors possess private information about the corporate spin-offs and are able to utilize their informational advantage to realize superior trading profits on spin-offs.;In the second chapter, co-authored with Thomas Chemmanur and Gang Hu, we make use of a large sample of proprietary transaction-level institutional trading data to study several important issues surrounding the role of institutional investors in SEOs: whether institutional investors indeed have private information about SEOs, and its consequences for: SEO share allocation; institutional trading before and after the SEO and trading profitability; and the SEO discount. Overall, our results are consistent with an information production rather than a manipulative trading role for institutional investors in SEOs.;In the third chapter, co-authored with Thomas Chemmanur and Debarshi Nandy, we conduct the first large sample study of the going public decisions of U.S. firms in the literature, using the Longitudinal Research Database (LRD) of the U.S. Bureau of Census. The empirical analysis of the paper is organized in two parts that attempt to address two related questions regarding a firm's product market prospects and its going public decision. First, At what point in a firm's life should it go public? How do a firm's ex ante product market characteristics relate to its going public decision? Second, what are the implications of a firm going public on its post-IPO operating and product market performance?... |
