Internationalization and Firm Valuation: New Evidence from First Offshore Bond Issuances of US Firms
50 Pages Posted: 6 Feb 2018 Last revised: 4 Jun 2019
Date Written: 2019
Does internationalization affect firm valuation? To answer this question, literature mainly considers firms from around the world internationalizing by issuing equity in the USA, whereas the current study focuses on US firms that internationalize by issuing debt in overseas markets. This paper provides evidence on theories of internationalization and capital structure, finding that overseas corporate debt offerings have a positive short-term effect on US firms’ valuations. The effect varies in firm characteristics, timing, and the location of the issue. Additionally, firms with a strong need for external funds and growth prospects accelerate their offshore public debt market entry.
Keywords: Internationalization; Dept Structure; Segmentation; Tobin's
JEL Classification: G15; G32; F36
Suggested Citation: Suggested Citation