The contractual commitments of the reference shareholders at the time of the IPO.

Summary This work aims to determine, in the context of companies going public, the factors that explain the presence of contractual commitments by the main shareholders on the one hand and their impact on the value of the firm on the other. The term "contractual commitment" refers to two mechanisms put in place at the time of the IPO: commitments to retain shares by managers and shareholders' agreements. Our study focuses on a sample of 292 companies listed between 1996 and 2000 on the Nouveau Marché and the Second Marché of the Paris Stock Exchange. Our results show that the presence and duration of executive shareholding commitments serve to signal the value of the firm when information asymmetry is high but also to compensate for some inefficiencies in the firm's governance system. We also observe a negative impact on the value of the firm of management retention commitments, whereas those concerning venture capital firms have a positive impact. Regarding shareholders' agreements, our work shows that their implementation is more likely when managers anticipate a future sale of the firm. They also have a positive influence on the value of the firm as long as they do not protect the signatories from a hostile takeover. In the latter case, the effect on the value of the firm is negative. Finally, we show that there is a negative reaction of the stock market price around the day of the expiration of the retention agreements.