An Empirical Study On The Relationship Between Chinese Listed Companies And Securities Companies

SEO (Seasoned Equity Offering) refers to the listed companies issue new shares to raise funds again in the primary market after the IPO (Initial Public Offering), including the Public-issuance, Rights Issue, Convertible Bonds, etc. Just like the IPO, SEO need the participation of listed companies, securities firms, new shareholders and individual investors. The relationship between listed companies and institutional investors, and new shareholders can only be researched through the stock volatility and the change of stock holding ratio. But the relationship between the listed companies and securities companies can only be studied in SEO. In this article we attempt to explain what impacts the relationship between listed companies and securities companies from the view of why listed companies change their IPO lead underwriters.In this article we collect760listed companies and find that559companies change their lead underwriters in the first SEO after IPO, the proportion was73.6%, that is, most of the relationship between China’s listed companies and securities companies is "one-shot deal". Through the analysis of main factors of the listed companies, this paper made assumptions and interpretation of "short-lived business" phenomenon. This paper would give some evidence why they switched. This paper thinks that IPO pricing will affect the relationship between the listed companies and the securities companies, but listed companies will not change the securities companies with high underpricing rate, in contrast, the possibility of listed companies with high IPO underpricing rate to change their Underwriters in the SEO business is tower, that is, listed companies pay more attention to the performance of other aspects. Secondly, the listed companies lay emphasis on reputation and tend to choose securities companies with high reputation as SEO underwriters. Furthermore, the relationship between listed companies and the securities companies is significantly affect by the time, the longer the interval time between the IPO and SEO, the higher possibility to change the lead Underwriter. Finally, we find that System is another important factor, state-owned listed companies and non-territorial IPO listed companies tend to change their lead underwriters, and territorial listed companies are more likely to get the replacement for reputable underwriter.