Spinning and Underpricing: A Legal and Economic Analysis of the Preferential Allocation of Shares in Initial Public Offerings

Authors

Sean J. Griffith, Fordham University School of LawFollow

Document Type

Article

Publication Title

Brooklyn Law Review

Volume

69

Publication Date

2003

Keywords

Securities Act, Exchange Act, underwriter, issuer, agency

Abstract

This Article investigates the preferential allocation, or “spinning,” of shares in initial public offerings. It begins by examining the offering process and the incentives of underwriters, issuers, and investors. Through this examination of the participants and the process, it locates the harm of spinning in the underpricing of initial public offerings. The Article then seeks to identify precisely which participants in the offering process are harmed by the practice and finally evaluates the most appropriate means of addressing this harm.

Recommended Citation

Sean J. Griffith, Spinning and Underpricing: A Legal and Economic Analysis of the Preferential Allocation of Shares in Initial Public Offerings , 69 Brook. L. Rev. 583 (2003-2004)
Available at: https://ir.lawnet.fordham.edu/faculty_scholarship/44