Equity cross-listings in the U.S. and the price of debt

Ball, R T, Hail, L and Vasvari, F (2018) Equity cross-listings in the U.S. and the price of debt. Review of Accounting Studies, 23 (2). pp. 385-421. ISSN 1380-6653 OPEN ACCESS


Using a large panel from 46 countries over 20 years, we find that non-U.S. firms issue corporate bonds more frequently and at lower offering yields following an equity cross-listing on a U.S. exchange. Firms issue more bonds through public offerings instead of private placements and in foreign markets rather than at home, in both cases at significantly lower yields. Moreover, the debt-related benefits are concentrated among firms domiciled in countries with less private benefits of control, efficient debt enforcement, and developed bond markets, suggesting that equity cross-listings cannot completely offset the impact of weak home country institutions. The results support the notion that the monitoring, transparency, and visibility benefits brought about by equity cross-listings on U.S. exchanges are valuable to bond investors.

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Item Type: Article
Subject Areas: Accounting
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© 2018 Springer. The final publication is available at Springer via https://doi.org/10.1007/s11142-017-9424-0

Date Deposited: 14 Jul 2017 15:30
Date of first compliant deposit: 14 Jul 2017
Subjects: Corporate governance
Debt financing
Disclosure of financial information
Last Modified: 30 Jun 2024 00:47
URI: https://lbsresearch.london.edu/id/eprint/838

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