Kasim Alli

Short- and Long-Run Performance of Initial Public Offerings in Postapartheid South Africa

This paper examines the impact of liberalization on initial public offering (IPO) performance in postapartheid South Africa. Results indicate a significant reduction in IPO underpricing in the postapartheid period relative to the level reported for IPO offerings in the apartheid period. Significant long-term underpricing for periods of up to two years following the IPO is noted. Many IPO offerings in South Africa are delisted and acquired or merged within three to five years of the IPO offering. Subsequently acquired IPOs are found to be more underpriced than are nonacquired IPOs, a result consistent with the use of IPOs as a means of facilitating acquisitions and mergers.

Research note: neural network analysis of dividend policy

Summarizes the main hypotheses used in previous research on dividend policy and reports a study of patterns in dividend payouts/growth using neural networks as a data mining technique. Discusses the properties of neural networks, recognizes that they are unsuitable for hypothesis testing and uses sensitivity analysis on 1992‐1997 data from 201 US firms. Presents the results, which do not outperform a previous model based on factor analysis, finds no significant nonlinear relationship in the data; but shows that dividend variability is sensitive to input variables, especially dividend growth.