Why do listed companies delist themselves voluntarily? An empirical study of the Tokyo Stock Exchange and the construction and real estate industries

摘要

Purpose - This study aims to analyse, from a corporate finance and governance perspective, the reasons why managers decide to delist their companies from a stock exchange. On the basis of five hypotheses of voluntary delisting, this study examines why listed companies in the construction and real estate sectors voluntarily delist themselves from the stock exchange. Design/methodology/approach - By using actual data to examine contractors and real estate companies listed on the Tokyo Stock Exchange between 2004 and 2014, this study analyses whether these companies delist themselves voluntarily. A pooled binary logit model is used as the statistical method. Findings - In both the construction and real estate sectors, the concentration of shareholders has a significantly positive effect on voluntary delisting, thus supporting the transfer of the wealth effect hypothesis. In construction, market capitalisation has a significantly negative effect on voluntary delisting, thus supporting the maintenance cost reduction hypothesis. In the real estate sector, the market capitalisation-to-total assets ratio has a significantly negative effect on voluntary delisting, thus supporting the undervalue elimination hypothesis. Originality/value - By comparing the construction and real estate sectors, this study reveals both unique and common reasons for voluntary delisting in each sector. It also offers valuable insights to managers, regulators setting standards in securities markets and investors.