The IPO share lockup agreements in Greece

Abstract

In the Greek market has not been conducted any research in the trading activity and the stock reaction after the expiration of the lockup agreement in the Athens Stock Exchange. Therefore, this study examines the behavior of Greek stocks listed in the Athens Stock Exchange after the expiration of the lockup agreement. We also, examine the behavior of stocks not only after the first trading day. We have noticed that in all the prospectus major stockholders mention whether they will sell a certain percentage of their shares in the second six months or not. It must be noted that it is not mandatory by Greek legislation to mention whether they will sell or not but it rather an agreement between the major stockholders and the underwriters in an attempt to improve the IPO success. The interesting will be to examine the behavior of Greek shares after the first six months of trading and especially to examine the stock reaction of companies whose major shareholders have stated that they will not sell and those companies whose the major shareholders have stated that they will sell. In other words, we will examine whether the market compensates companies where the major shareholders remain loyal to their company.