This paper examines whether the JOBS Act’s 700 million public-float threshold, which conditions regulatory relief for Emerging Growth Companies, altered post-IPO acquisition behavior. Using a large sample of IPOs and a design analogous to difference-in-differences that compares issuers below and above the threshold before and after the Act, we find that firms below the threshold undertook fewer acquisitions and spent less on deals than comparable firms above it. The decline is concentrated in stock-financed deals, consistent with firms avoiding equity issuance that would raise float. The effect is attenuated in high-growth industries, where acquisition opportunities outweigh regulatory savings. We find no corresponding change in capital expenditures. Overall, the evidence indicates that size-based regulatory thresholds can reshape corporate investment and post-IPO growth, with important implications for IPO-market policy design.
Azizjon Alimov (Sat,) studied this question.