Cross-border acquisitions and financial leverage of UK acquirers

Agyei-Boapeah, Hebry

Abstract

Based on a sample of 782 acquisitions by UK firms during 1982-2009, this paper examines the impact of cross-border acquisitions on financial leverage. The paper shows that cross-border acquisitions have a negative impact on the financial leverage of acquiring firms. However, the negative impact of cross-border acquisitions disappears when acquirers choose targets from developed countries, and also when the acquisitions are undertaken by multinational firms. Collectively, the findings imply that exposure to foreign markets reduces the borrowing ability of acquiring firms especially when they choose targets from developing countries, and when they have no experience in foreign markets.

Citation

Agyei-Boapeah, H. (2015). Cross-border acquisitions and financial leverage of UK acquirers. Accounting Forum, 39(2), 97-108. https://doi.org/10.1016/j.accfor.2015.03.002

• Journal Article Type: Article
• Acceptance Date: Mar 24, 2015
• Online Publication Date: Apr 9, 2015
• Publication Date: Jun 30, 2015
• Deposit Date: Jul 1, 2021
• Publicly Available Date: Jul 14, 2021
• Journal: Accounting Forum
• Print ISSN: 0155-9982
• Electronic ISSN: 1467-6303
• Publisher: Elsevier
• Peer Reviewed: Peer Reviewed
• Volume: 39
• Issue: 2
• Pages: 97-108
• DOI: https://doi.org/10.1016/j.accfor.2015.03.002
• Keywords: Financial leverage; cross-border acquisitions; internationalization; M&A; UK 2
• Public URL: https://nottingham-repository.worktribe.com/output/5750532
• Publisher URL: https://www.sciencedirect.com/science/article/pii/S0155998215000125
• Additional Information: This is an Accepted Manuscript of an article published by Taylor & Francis in Accounting Forum on 09/04/2015, available online: https://www.sciencedirect.com/science/article/pii/S0155998215000125