Creditor rights, claims enforcement, and bond performance in mergers and acquisitions

• 成果类型: Article
• 署名作者: Renneboog, Luc; Szilagyi, Peter G.; Vansteenkiste, Cara
• 署名单位: Tilburg University; Central European University; University of Cambridge
• 刊物名称: JOURNAL OF INTERNATIONAL BUSINESS STUDIES
• ISSN/ISSBN: 0047-2506
• DOI: 10.1057/s41267-016-0031-2
• 发表日期: 2017
• 页码: 174-194
• 关键词: bondholder value; Cross-border mergers and acquisitions (M&As); Creditor rights; Legal enforcement; event study; Eurobonds

摘要

This article shows that country-level differences in creditor protection affect bond performance around cross-border M&A announcements. Using Eurobonds and a global sample of 1,100 cross-border M&As, we find that the bondholders of bidding firms respond more positively to deals that expose their firm to a jurisdiction with stronger creditor rights and more efficient claims enforcement through courts. Positive creditor protection spillovers are enhanced by now-global jurisdictional cooperation in multinational insolvencies and creditors' ability to do insolvency arbitrage. The spillover effects we observe are stronger for firms With higher asset risk, longer maturity bonds, and a higher likelihood of financial distress.