Research On The Influences On PE Exiting Speed Post-IPO

With the development of Chi Next,private equity—or PE— has ushered in a golden age in China.The IPO exit which is favored by PE becomes the main exit channel of the current PE because of its relatively perfect exit route and high return.At present,most of domestic and foreign researches on the exit of PE regard the IPO itself as an exit event,assuming the time when invested enterprise successful listing is the time when PE realized the exit,ignored the existence of the lock-up period.However,PE must go through a lock-up period before exiting the IPO companies.So when we study the PE exit problems,we must pay close attention to the post-IPO exit strategy in which PE exit speed is an important measurable indicator.A combination of theoretical research and empirical research was adopted.Firstly,we built a theory framework of influence factors of PE post-IPO exit.Then proved the influence factors of PE exit speed post-IPO from three aspects which is PE characteristics,corporate governance factors and IPO company’s financial performance change during lock-up period.Secondly,on the basis of theoretical analysis,we proposed seven hypotheses.And then establish a series of suitable regression models to prove these hypotheses,which including the PE reputation,PE nature,PE investment scale,PE holding investment purpose,IPO companies relative shareholding level,the deviation degree of control rights and cash rights and financial performance change levels during IPO lock-up period.After that,a regression analysis was conducted on the large data samples of the GEM from 2009 to June 30,2014,and the conclusion was obtained and the robustness test was conducted for the regression results.Finally,the policy Suggestions are given from both PE and IPO companies.The study found that the exit speed of PE after IPO was influenced by the characteristics of PE itself,the governance factors of IPO companies and the financial performance change level of IPO companies.In terms of PE itself characteristics,PE exit speed post-IPO has significantly positive correlation with PE reputation,PE nature and PE investment scale.And compared with state-owned PE,non-state PE are more inclined to quit as soon as possible after the IPO.While PE holding investment purposes and PE exit speed have no significant correlation post-IPO.In terms of corporate governance factors,PE post-IPO exit speed and the IPO companies’ relative equity structure present a "U" curve change.While the deviation degree of control rights and cash rights of IPO companies is significantly positive correlate with PE post-IPO exit speed.Financial performance changes level in IPO lock-up period has significant negative correlation with PE post-IPO exit speed,namely when the IPO company’s financial performance is rising steadily,PE will slow the speed of the exit.The research conclusions will enrich and optimize the theoretical and empirical research of the PE exit decision-making.At same time,the research conclusions will provide decision-making support for PE,but also provide the basis for the IPO companies to perfect the corporate governance structure.