Peut-on prédire la réussite ou l'échec d'une small-cap ?

Abstract

Since the beginning of the eighties, the number of firms turning to stock markets has constantly increased. Firms turn to stock markets for different reasons. Firstly, they decide to go public for the financing possibilities that stock markets bring. Indeed, those firms issue a certain number of shares to the public in order to raise funds. This access to funding is available during the initial public offering and all along their quotation via capital increase. Secondly, going public brings more diversification and more liquidity. It allows the shareholders wishing to give up their equity position to sell them without bearing substantial costs. It then becomes an exit strategy allowing them to obtain liquidity in exchange of their shares. Thirdly, going public offers more visibility and recognition. Despite those advantages of quotation, more and more firms decide to go private. Those operations called “Public to private” or “Going Private” started in the United-States during the eighties. Then those transactions appeared in Great Britain and saw its number peak in 1989. It was not until the 1990s that a wave of “P to P” arrived in Europe. Then those transactions kept increasing until now. Indeed, the number of firms quoted decreased by 13% from 2007 to 2017 in Europe. In Belgium, it decreased from 265 firms in 2000 to 116 firms in 2017. We can notice the same decrease in France and in Germany, whereas in the Nederland it decreased by more than a third in the last 20 years. But why do firms go private? Going public also carries its share of inconveniences. First of all, there are all the costs directly related to the quotation like listing fees, communication costs and costs of production of information. The loss of confidentiality, the disinterest of analysts for Small-caps and the problem of illiquidity are three other major disadvantages of being public. In this thesis, we will focus on the reasons why small firms decide to go private and whether or not it is possible to predict their failure. We will focus on Small-caps from four different countries: Germany, Belgium, France and Nederland.