Strategic Fit or Financial Flop? Short- and Long-Term IPO Performance of PE/VC and CVC Backed Firms in Scandinavia

Sammanfattning

This paper analyzes IPOs in Scandinavia from 2011 to 2023, using underpricing andBHAR over 6, 12, 18, and 24 months as measures of performance. The findings showthat IPO underpricing is evident in the Scandinavian market, with average underpricing ranging between 11% and 12%. However, neither sponsor-backed nor CVC-backedIPOs exhibit a significant effect on underpricing. Regarding long-term performance, traditional sponsor backing is not significantly related to abnormal returns, whereas CVCbacked firms underperform at the 6- and 24-month horizons. While still underperforming, innovation-intensive CVC-backed firms experience less post-IPO underperformance.Lastly, higher underpricing is positively associated with BHAR across the examined periods, although the strength of this relationship differs by sponsor type.