IPOs & Lockup Length: Can information asymmetry and moral hazard explain lockup length?

Sammanfattning: In this paper we examine the determinants of IPO lockup length. The focus is primarily on moral hazard and information asymmetry. We find support for moral hazard as a driver of lockup length, but not for information asymmetry. The research is based on Swedish data and then compared to results from research done on US and UK data. This is an attempt to discern what specific features in the country's IPO environment that could explain the different results in prior literature. We also combine this with other literature on the role of cornerstone investors in IPOs. We hypothesize that the asymmetric information between different investors will decrease as a consequence of cornerstone investors, but we find no evidence for this.