58 Pages Posted: 6 Mar 2004 Last revised: 30 Mar 2009
Date Written: February 28, 2004
We study merger and acquisition (M&A) payment choices of European bidders for publicly and privately held targets in the 1997-2000 period. Europe is an ideal venue for studying the importance of corporate governance in making M&A payment choices, given the large number of closely held firms, and the wide range of capital markets, institutional settings, laws and regulations. The tradeoff between corporate governance concerns and debt financing constraints is found to have a large bearing on the bidder's payment choice. Consistent with earlier evidence, we find that several deal and target characteristics significantly affect the method of payment choice.
Keywords: Corporate finance, Corporate Governance, M&As
JEL Classification: G30, G34
Suggested Citation: Suggested Citation
Faccio, Mara and Masulis, Ronald W., The Choice of Payment Method in European Mergers & Acquisitions (February 28, 2004). Journal of Finance, Vol. 60, No. 3, pp. 1345-1388, 2005. Available at SSRN: https://ssrn.com/abstract=492284
By Rainer Lenz