The timing of voluntary delisting

Azevedo, A., Colak, G., El Kalak, I. and Tunaru, R. (2024) The timing of voluntary delisting. Journal of Financial Economics, 155. 103832. ISSN 1879-2774 doi: 10.1016/j.jfineco.2024.103832

Abstract/Summary

For many firms, voluntarily delisting from a stock exchange can be optimal. We model an entrepreneur’s incentives to voluntarily delist the firm as a trade-off between consumption of private benefits when listed and expected improvements in the firm’s performance after delisting. Our model allows for heterogeneity across firms and countries, and various micro and macro shocks affect the delisting decision. Such a model makes novel predictions regarding the delisting patterns around the world. We empirically confirm these predictions using manually collected delisting data from 26 countries. Increasing policy and regulatory uncertainties can partially explain the greater popularity of voluntary delistings.

Item Type	Article
URI	https://reading-clone.eprints-hosting.org/id/eprint/118428
Identification Number/DOI	10.1016/j.jfineco.2024.103832
Refereed	Yes
Divisions	Henley Business School > Finance and Accounting
Publisher	Elsevier
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