Unit IPOs: A Mechanism for Small Businesses to Go Public
研究了单位IPO（股票与认股权证组合）是否适合小企业上市，发现单位IPO主要由更小、更年轻、风险更高的公司发行，交易成本高于股票IPO，但能带来更高募集资金和后续融资便利。
The ability to raise capital to finance growth projects is a major challenge to new and growing small businesses which are typically private companies. Their efforts to raise capital on favorable terms are constrained by the lack of liquidity of private shares and by the absence of generally available information on their future prospects. Banks and other lenders seek higher premiums for the lack of liquidity for non-traded shares and often impose highly restrictive covenants on private companies to account for the information asymmetry and the resulting moral hazard and agency problems. The problem of information asymmetry is particularly acute for small businesses since there is generally less information available on them. Problems with private financing have caused entrepreneurs to turn to the initial public offering (IPO) market to raise capital. A firm enhances its liquidity by going public and simultaneously is able to convey more information on its future prospects by virtue of increased market monitoring. However, by going public, a firm incurs direct costs in the form of underwriter and administrative fees and indirect costs in the form of underpricing. Private firms planning to become public corporations have to identify both the timing and the appropriate mechanism to make this transition. Usually, firms go public through a sale of common stock, however, another alternative is to sell units, which are a combination of common stocks and common stock purchase warrants sold as a package. Numerous academic studies have examined stock IPOs but relatively little is known about unit IPOs.(1) This study attempts to identify whether unit IPOs represent a feasible mechanism for small businesses to make the transition from private to public ownership. Specifically an attempt is made to address the following questions: (1) Are unit issuers primarily small busineses? (2) Are the overall transaction costs higher for unit IPOs than stock IPOs?(2) (3) Are there any benefits to issuing unit IPOs instead of stock IPOs? The results of this study suggest that unit IPOs are issued primarily by smaller, younger, riskier firms with little or no prior operating history or sales. The median total transaction cost of going public as a percentage of the gross proceeds for unit IPOs is 3.40 percent greater than the median transaction cost for similar stock IPOs. Advantages of unit include higher proceeds at the IPO and the ability to trigger a subsequent round of financing without incurring the additional cost of a seasoned offering. These advantages are particularly attractive to smaller, riskier, growing businesses characterized by high levels of uncertainty. PREVIOUS RESEARCH Prior studies in the IPO literature have focussed primarily on the short-run underpricing behavior and the presence of hot and cold markets. One of the earliest prominent studies to document significant IPO underpricing was by Ibbotson (1975). The existence of the hot issues phenomena, which represents periods in the economy characterized by severe levels of IPO underpricing, was documented by Ibbotson and Jaffe (1975) and Ritter (1984). Subsequently studies by Ibbotson, Sindelar, and Ritter (1988), Carter and Manaster (1990), and Ritter (1991) confirmed the continued existence of severe underpricing in IPOs. Only two studies have attempted to measure the transaction costs of going public and, in both instances, the analysis was confined to stock IPOs. Ritter (1987) found that firm commitment IPO issuers surrendered a staggering 22 percent of the market value of their equity during the process of going public. Aggarwal and Rivoli (1991) provided similar findings. Several theoretical studies have attempted to provide an equilibrium explanation for the persistence of IPO underpricing. Rock (1986) suggested that underpricing results from the winner's curse problem due to asymmetrically informed investors. …