Voluntary Delisting In Korea: Causes And Impact On Company Performance

Abstract

This research investigates the attributes of firms that choose to voluntarily delist in Korea, including the evolution of firms after delisting, using performance indicators such as total assets, revenue, and net income. Empirical evidence suggests that the higher the shareholding ratio of the largest shareholder and the higher the growth prospects and liquidity, the greater the incentive for voluntary delisting. In addition, firms in non-high-tech industries choose to delist more often than those in high-tech industries. Further, firms that have delisted show lower total assets, revenues, and net incomes than listed firms, and these gaps increase over time.