THE OVERSEAS LISTING OF MAINLAND CHINESE COMPANIES

Abstract

This study examines the evolution of mainland Chinese firms’ overseas initial public offering (IPO) location choices since 1990 across different countries. Specifically, we examine four research questions: 1) What makes an overseas stock exchange attractive to mainland Chinese companies? 2) Is the initial post-listing valuation different for mainland Chinese companies across stock exchanges? 3) Is the long-term performance different for mainland Chinese companies across stock exchanges? 4) Can investors in destination stock exchanges get diversification benefits from owning mainland Chinese companies? The study provides relevant information to struggling stock exchanges such as Singapore Stock Exchange on how to attract foreign listings and at the same time effectively regulate these foreign companies.