The going public decision: evidence from the IPOs in Italy and in the UK

This paper offers insight into the question of why only few companies go public in Continental Europe. By comparing the Italian and the London Stock Exchange, we draw attention to some of the differences between the equity markets of continental Europe and those of the Anglo-Saxon countries. The main difference is that companies going public on the LSE usually use the capital raised to rebalance their capital structure, while companies going public in Italy use the IPO as a means to temporarily lower their debt exposure and then access to further debt on an improved bargaining position with banks.

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