The impact of private equity on IPO underpricing in the DACH region

This research provides a study to the difference in underpricing between private equity backed initial public offerings and non-private equity backed initial public offerings in the DACH region between 2003 and 2017. The results show that PE-backed IPO underpricing does not differ from non-PE backed IPO underpricing. Common aspects such as the size of the company, the age of the company or the rank of the underwriter could not explain various influences on underpricing. The aftermarket shows no discrepancy as well up to the first twelve months after the IPO. This implies that it is possible to gain from investing in PE-backed IPOs from one year after the IPO.