The Determinants of Share Repurchases in Europe

33 Pages Posted: 28 Feb 2010 Last revised: 17 Jan 2019

See all articles by Dimitris Andriosopoulos

Dimitris Andriosopoulos

Strathclyde Business School

Hafiz Hoque

University of York; City University London - Sir John Cass Business School

Date Written: October 1, 2011


In this research paper we employ a logit model methodology in order to identify the determinants of a firm’s decision to announce a share repurchase. In the models, we incorporate firm specific financial characteristics and measures of share price performance. Hence, we are able to estimate the probability of open market share repurchase announcements across Europe. The robustness of the proposed models is investigated across different dimensions of sample construction methods and with a boot-strap technique. We find that leverage, size, and ownership concentration, have a significant impact on the announcement of share repurchases in all three countries under study. Finally, we construct a number of models with strong predicting ability of a firm’s likelihood to announce a share repurchase.

Keywords: Share repurchases, determinants, information asymmetry, free cash flow, undervaluation, probability, logit model, boot-strap

JEL Classification: G14, G32, G34, G35

Suggested Citation

Andriosopoulos, Dimitris and Hoque, Hafiz, The Determinants of Share Repurchases in Europe (October 1, 2011). International Review of Financial Analysis, Vol. 27, 2013. Available at SSRN: or

Dimitris Andriosopoulos (Contact Author)

Strathclyde Business School ( email )

199 Cathedral Street
Department of Accounting and Finance
Glasgow, G4 0QU
United Kingdom
+44(0)1415483892 (Phone)


Hafiz Hoque

University of York ( email )

The York Management School
York, YO10 5GD
United Kingdom
+44 (0) 7515890949 (Phone)

City University London - Sir John Cass Business School ( email )

106 Bunhill Row
London, EC1Y 8TZ
United Kingdom
+44(0)7515890949 (Phone)
+44(0)2070408546 (Fax)

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