Factors Influencing Brazilian Firms in their Decision to List on Foreign Stock Exchanges

Abstract:     
The paper's purpose is to determine empirically factors that influence Brazilian firms in their decision to cross-border list their stock. The methodology adopted involves an economic analysis of Brazilian cross-listed firms, characterizing and differentiating them from non cross-listed firms, univariate and multivariate tests, using the logit model and a sample of 288 firms listed on Brazilian stock exchanges. The economic analysis shows that cross-listed firms invest substantially, and are profitable, dynamic, and highly valued on the domestic market. The results of the hypotheses tests indicate that size, stock market share, exposure on foreign markets, and best practices of corporate governance seem to be factors influencing Brazilian firms to cross list. Firms belonging to the Telecommunications industry sector seem to have a higher probability to cross-list. The relevance of the study is in improving the knowledge on the behavior of Brazilian firms in international capital markets.

Keywords: Brazilian firms, cross-border list, cross-list, stock markets, logit model

JEL Classifications: C25, G10, G18, M49

Working Paper Series