Determinants of Decision to go Public, Made by Russian Companies

The factors, which determine the decision of a company to start the process of IPO is one of the least studied area on the topic of initial public offerings. In particular, while searching for existing empirical studies, I have not come across any published researches, which are devoted to analysis of reasons, and motivations of the decision making of Russian companies to become publically listed firms. Therefore, the aim of my research is to try to determine some factors which are significant during the process of the managers making decision on their becoming a public company or remaining private. In the course of my research, I found some relationships between the chosen factors and the probability of a Russian company becoming public, which are described in the paper. Besides, I made a comparative analysis of those results to the results, obtained by Polish scientist during similar researches, performed for the samples of companies from Poland. Taking into consideration a rather small sample of companies, which have gone public and due to lack of some necessary data, not all of the tested coefficients showed the significant effect on the probability of IPO. However, they helped to determine the constant sign of those effects. My research is a drop in a bucket of researches that are devoted to the decision of going public, made by Russian companies. With time, when more Russian companies start using the IPO technique to attract additional funds to the firm, the sample for a possible research will become broader. That will let to obtain more significant results with higher explanatory power, which in turn will give rise to the new area of study in Russian corporate finance theory.