Equity Valuation in the Czech Voucher Privatization Auctions

Financial Management, Vol. 29, No. 4, Winter 2000 and Financial Management, Vol. 30, No. 1, Pp. 4-5, Spring 2001 (Errata

Posted: 7 Jun 2001

See all articles by Joel T. Harper

Joel T. Harper

Miami University of Ohio - Department of Finance

Raj Aggarwal

University of Akron; Federal Reserve Banks - Federal Reserve Bank of Cleveland; Kent State University; Kent State University Foundation

Abstract

This is a study of the determinants of share pricing and demand in the path-breaking Czech voucher-based multiple-round mass privatization auction. The results presented here document that share valuation and demand in this auction were based on firm characteristics such as return on sales, sales growth, and ownership structure in the early rounds. However, such information declined in importance while auction results on share prices and trading volumes from prior rounds increased in importance as determinants of share prices and demand in later rounds. While share prices overshot or undershot in the early rounds, by round four they had stabilized and the market cleared successfully by the fifth and final round. These results are new evidence on the price discovery process in the Czech privatization auction and confirm the success of this auction in the efficient pricing and equitable distribution of enterprise shares.

Suggested Citation

Harper, Joel T. and Aggarwal, Raj, Equity Valuation in the Czech Voucher Privatization Auctions. Financial Management, Vol. 29, No. 4, Winter 2000 and Financial Management, Vol. 30, No. 1, Pp. 4-5, Spring 2001 (Errata, Available at SSRN: https://ssrn.com/abstract=267753

Joel T. Harper (Contact Author)

Miami University of Ohio - Department of Finance ( email )

Oxford, OH 45056
United States

Raj Aggarwal

University of Akron ( email )

Akron, OH 44325-4803
United States

Federal Reserve Banks - Federal Reserve Bank of Cleveland ( email )

East 6th & Superior
Cleveland, OH 44101-1387
United States

Kent State University ( email )

College of Business Administration
Kent, OH 44242-0001
United States

Kent State University Foundation ( email )

Akron, OH 44325-4803
United States

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