Ch. 6: Security Offerings 259
Ta b l e 5
Time between an IPO and follow-on offerings, conditional on observing at least one follow-on offering,
classified by security type, 1980–2000
N Mean Std. Dev. Min MaxA. First post-IPO issue regardless of security type
Seasoned equity offerings 1724 2. 31 2. 50 0. 18 15. 26
Private placement of equity 119 2. 81 2. 30 0. 00 11. 60
Preferred equity 61 2. 64 2. 61 0. 07 10. 98
Convertible debt 129 1. 95 1. 98 0. 21 12. 21
Private placement of debt 353 2. 52 2. 62 0. 01 13. 86
Straight debt 124 2. 27 2. 41 0. 00 12. 47
Overall 2531 2. 35 2. 51 0. 00 16. 44
B. First post-IPO issue conditional on security type
Seasoned equity offerings 2665 3. 30 3. 26 0. 13 19. 70
Private placement of equity 214 3. 80 3. 11 0. 00 18. 70
Preferred equity 142 4. 22 3. 33 0. 07 13. 40
Convertible debt 315 3. 62 3. 15 0. 21 15. 58
Private placement of debt 1230 4. 49 3. 60 0. 01 18. 26
Straight debt 514 5. 28 4. 05 0. 00 18. 02
Source:Eckbo and Norli (2006). The table reports the number of calendar days between a firm’s IPO date
and the date of subsequent security offerings. The restriction that there must be at least one follow-on offering
before 12/2000 (regardless of security type) restricts the sample from 6,092 to 2,531 IPOs. Panel A lists the
time between the IPO and the first follow-on issue regardless of the type of security issued. Panel B shows
the time between the IPO date and the date of the follow-on issue given that the security is of the type listed
in the panel.Nis the number of security offerings after the IPO. For example, Panel B shows that there are a
total ofN= 2 ,665 (or 28%) SEOs following the 6,092 IPOs over the sample period.
Table 5, which appears inEckbo and Norli (2006), shows descriptive statistics for
follow-on security offerings made by 6,092 firms that went public during the period
1980–2000. A total of 3,579 firms (approximately 59%) donofollow-on offering during
the sample period. Since firms going public in the last part of the sample period would
have little time to do a follow-on offering, this number overstates the true fraction of
non-follow-on firms. However, restricting the sample to the 3,750 IPOs that were com-
pleted in the period 1980–1993, which insures a minimum seven-year post-IPO period,
a total of 1,977 firms (53%) did no follow-on offering during the interval 1980–2000.
Overall, it appears that only one of two firms undertaking an IPO comes back to raise
capital externally through a public security offering.^14
(^14) Firms that delist in the first few years after their IPO are even less likely to have any follow-on offerings.
SeeFama and French (2004)for information on survival frequencies in the population of listed firms.Eckbo
and Norli (2005)show that delistings of IPO firms due to either acquisitions or bankruptcies in the first five
years after the IPO is indistinguishable from the delisting frequency of seasoned firms matched on size and
book-to-market ratio.