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Innovation is a key driver of a firm’s ability to survive in the financial market. Previous studies typically consider a firm dead once its shares are delisted from the stock exchange. Despite its negative connotation, delisting may be a strategic decision and therefore be a positive outcome for the company. We study how a firm’s innovative activity, in terms of R&D investments and number of patents, shapes its survival profile, taking into account the heterogeneous nature of delistings. Using a sample of high-tech small and medium enterprises (SMEs) going public in Europe during 1998–2003, we find that more innovative firms, both in terms of patents and R&D investments, have a higher probability to be taken over. However, while firms with a rich portfolio of patents are less likely to voluntarily delist, higher R&D investments increase a firm’s likelihood of being delisted due to compliance failure.

The purpose of this paper is to examine the determinants of involuntary delisting rate for the Egyptian initial public offerings (IPOs) issued over the period 1992-2009.

A definition of survival time that considers the date when the new Egyptian listing rules were enforced to track delisting status for each IPO firm for five survival years is relied on. Binary logit regression analysis is used to identify these determinants. Total sample is divided into two subsamples: the first subsample covers the period from 1992 to 2004. It is used to estimate the logit equations and to predict delisting status of firms included in the second subsample, which covers the period from 2005 to 2009.

The probability of involuntary delisting decreases significantly with the increase in firm size, institutional ownership, assets growth rate, operating efficiency, offering size, initial returns and insider ownership. However, it increases significantly in IPO firms with high financial leverage. Based on the estimated logit regression equations, the status of the six firms included in the second subsample are correctly predicted.

The results provide several implications for investors, issuing firms and setters of listing rules.

This study uses new variables, such as firm type, institutional ownership and listing variables. In addition, several theories are tested and supported.

Drawing on a cost–benefit perspective, this paper aims to explore the relation between information asymmetry and the decision to delist from stock exchanges during periods of uncertainty. Specifically, it investigates the role of firms’ intangible investments and the availability of alternative sources of finance on the decision to delist from foreign stock markets.

The study takes advantage of a natural experiment in which cross-listed Chinese firms facing uncertainty in US markets because of widespread allegations of accounting fraud decide on whether to remain listed or voluntarily delist. The decision to delist is modelled as a function of the level of information asymmetry between firms and their stakeholders and the availability of alternative financing, while controlling for other drivers of firms’ delisting decision. The data used in the empirical analyses cover a hand-collected sample of 91 Chinese firms voluntarily delisting from US stock markets between 2010 and 2016. This sample is matched with an equal sample of Chinese firms, which remained listed in US stock markets during the same period. A probit regression model accounting for fixed effects is used.

There is a significant positive relationship between investments in intangible assets and firms’ decision to delist. Moreover, the positive intangibles−delisting nexus is accentuated by the availability of alternative sources of financing. Collectively, the results are consistent with the theoretical argument that the higher information asymmetry associated with intangible assets may increase the cost of staying listed on stock exchanges, particularly in periods of uncertainty (captured in this study by accounting fraud allegations targeting cross-listed firms). The results have important implications for corporate managers, capital market participants and policymakers.

Policymakers and standard setters must continue to work to improve the accounting regulations of intangible assets and to promote the adoption of global accounting standard across both emerging and advanced economies.

The study exploits a unique natural experimental setting to explore why cross-listed firms delist. The underlying theoretical framework to explain delisting is new. This framework captures the role of information asymmetry, uncertainty and alternative financing in explaining the cost and benefits of remaining listed on a foreign market.

The purpose of this paper is to identify the extent to which the company's post- initial public offering (IPO) outcome varies, along with the determinants of the post-IPO outcomes.

The authors use Cox proportional hazards models to examine what determines the company's post-IPO transition to one of the classified outcomes, delisting, acquisition due to strong performance, and acquisition due to weak performance. The authors develop models taking in a range of information concerning pre-IPO characteristics, offering characteristics, financial indicators, company specifics, industry features, and corporate ownership and governance.

Delisting is predominantly influenced by the company’ pre-IPO operating performance, as well as financial indicators and governance structure at the time of the IPO. Sound governance structure and good financial standing of the company aid it to achieve its goal. Mergers and acquisitions (M&As) of both forms are distinguished most significantly by ownership structure and industry features, which is consonant with the position that M&As are majorly motivated by social concerns and corporate control considerations. Centrally, corporate evolution is jointly shaped by market force and state control.

The findings can inform public policy decisions. There is a case for gradual introduction of institutional changes which facilitate, regulate, and monitor orderly market operations in line with the market mechanism and sound corporate governance.

The study is among the first efforts to examine what determines the company's transition to one of the post-IPO states following the IPO in China's stock market.

This study aims to analyse, from a corporate finance and governance perspective, the reasons why managers decide to delist their companies from a stock exchange. On the basis of the five hypotheses of voluntary delisting, this study examines why listed companies delist themselves voluntarily in the construction and real estate sectors.

By using actual data to examine contractors and real estate companies listed on the Tokyo Stock Exchange between 2004 and 2014, this study analyses whether these companies delist themselves voluntarily. The pooled binary logit model is used as the statistical method.

In both the construction and real estate sectors, the concentration of shareholders has a significantly positive effect on voluntary delisting, thus supporting the transfer of wealth effect hypothesis. In construction, market capitalisation has a significantly negative effect on voluntary delisting, thus supporting the maintenance cost reduction hypothesis. In the real estate sector, the ratio of market capitalisation to total assets has a significantly negative effect on voluntary delisting, thus supporting the undervalue elimination hypothesis.

By comparing the construction and real estate sectors, this study reveals both unique and common reasons for voluntary delisting in each sector. It also offers valuable insights to managers, regulators setting standards in securities markets and investors.

This study aims to identify why restaurant firms go public (IPO) despite high financing costs and which factors make firms stay public for the long term after an IPO. Also, this study aimed to link and compare restaurant firms’ pre- and post-IPO accounting information and how IPO proceeds were used.

This study used random-effects regression analysis with a number of dependent variables for a sample of 1,347 unbalanced panel data. In addition, logistic regression analyses were used to identify why restaurant firms were delisted within short periods after going public.

First, rebalancing financial structures was the most important reason for IPOs, whereas financing future growth was only a minor motivation. Second, post-IPO performance significantly differed between restaurant firms based on their pre-IPO financial conditions, as well as how they used IPO proceeds. Third, restaurant firms with low profitability, inefficient non-operating expenses and difficulties in generating revenue increased their financial burdens, which ultimately caused restaurant firms to be delisted within a short period after an IPO. Furthermore, the reasons for merging included cash shortages, large short-term liabilities and increased major operating expenses, together with increases in capital expenditures.

This study is unique, in that it explains the relationships between motivations for going public and post-IPO performances by directly linking the usages of IPO proceeds with firms’ operational performances. To the best of the authors’ knowledge, this study is the first to examine the effects of IPOs on restaurant firms’ operational, non-operational, investment and financial activities on firms’ performances.

Using initial public offering (IPO) involuntary delisting data, this chapter examines whether and how motivated institutional investors affect the survivability of IPO firms. The empirical evidence shows that the likelihood of future delisting is much lower for IPOs with more motivated institutional investors. This impact is more pronounced for firms with higher information asymmetry. The motivated institutional investors also facilitate better post-IPO operating performance. The results are consistent with the prediction of the limited attention theory.

The purpose of this paper is to examine governance and earnings management implications of the delisting regulation in China, which designates firms with two consecutive losses as Special Treatment (ST) firms and delists such firms, should two more years of consecutive losses occur.

Samples were selected using the matching‐sampling method, and interrupted time‐series Logit regression analyses was used to test the determinants of ST firms using corporate governance factors and earnings quality.

It was found that firms which subsequently become ST firms have greater agency problems, as indicated by divergence of ownership and less independent boards, as measured by the number of independent directors. The ST firms subsequently reduce their agency costs by increasing ownership concentration and increasing the number of independent directors. Additionally, the results suggest that ST firms engage in earnings management after the first year of loss.

The paper suggests that agency problems play an important role in financial performance, and the Chinese delisting regulation does lead to improvements in governance; nevertheless, it might force firms to engage in earnings manipulation.

Distinct from previous empirical research that has examined earnings management, the authors study it in the context of the delisting regulation in China. Additionally, it is a longitudinal study examining how delisting regulations affect the governance of the firm under financial distress.

The purpose of this paper is to analyze the wealth effect of involuntary delisting and investigate insider opportunism and the role of corporate governance, liquidity and legal environment in involuntary delisting in Japan’s stock market.

The authors use a sample of 136 involuntarily delisted firms in Japan’s stock markets between 2002 and 2012. The authors examine ownership changes of inside shareholders prior to delisting and estimate regression models for the wealth effect of involuntary delisting.

Involuntary delisting is highly disruptive in Japan, and limited liquidity of delisted stocks appears to be an important cause. However, the ownership reduction of inside shareholders before delisting is limited, totaling 2–3 percent. For delisted firms with an insider bank, the decrease in share price leading up to a delisting announcement is much less, while the decrease in share price upon a delisting announcement is far greater.

The study investigates involuntary delisting in regard to the opportunistic behavior of inside shareholders and the role of institutional environment in Japan’s stock market. Insiders, especially insider banks, maintain ownership in a distressful context leading to the forcible delisting of a distressed firm. The authors find some evidence that suggests that the market believes the insider bank will try to prevent the ailing firm’s insolvency. The findings are consistent with the implicit relational contracts that characterize Japanese firms.

The purpose of this paper is to examine the moderating effect of brand preference and type of shopping trip on the relationship between replacing a delisted national brand (NB) with a retailer’s private label (PL) brand (premium vs standard) and private label switching (PLS), that is switching from NB to PL.

Inside a major French retail chain store, an experiment with 1,392 NB buyers tested the impact of replacing NB with PL on PLS.

Results stress the positive contribution of PL replacements after NB delisting on buyers’ switching behaviour at different brand preference levels and shopping trip types. A main-choice NB for a major trip shopping benefits a PLS to premium PL. However, when a fill-in shopper looks for a secondary brand, competition between PL standard and NB may not be as weak as suggested in earlier studies.

The limitation of this study is that respondents reported their purchases instead of actually buying.

This study highlights that the retailers that delist some NB brands in the category should adopt a strategy either to develop premium or standard PLs, depending on consumers’ brand preference and shopping trip type.

Delisting is an opportunity to question the NB product competitiveness towards PL.

The study is based on actual delisting and replacement, combined with a large sample, unlike previous studies. Moreover, it bridges two important areas of research: conflict in marketing channels and PL introduction in retailers’ assortment decisions.