欧洲并购融资方式的选择外文翻译.doc

外文翻译 原文 The choice of financing method in European mergers & acquisitions Material Source: Vanderbilt University Author: Mara Faccio Global M&A activity has grown dramatically over the last ten years, bringing with it major changes in the organization and control of economic activity around the world. Yet, there is much about the M&A process that we do not fully understand, including the choice of payment method. Given the large size of many M&A transactions, the financing decision can have a significant impact on an acquirer’s ownership structure, financial leverage, future profitability and subsequent financing decisions.In this study, we examine the choice of payment method and its determinants across a large sample of European M&A transactions. Unlike several earlier studies of this question, our primary focus is on the relative importance of debt financing constraints and threats to corporate control, which have opposing effects on an acquirer’s financing choice. An acquiring firm’s financing decision can be strongly influenced by its debt capacity, existing leverage and target leverage ratio, given that most acquirers have limited cash holdings, so that cash acquisitions generally require debt financing.1 Under existing theories of capital structure, debt capacity is a positive function of tangible assets, growth in earnings and asset diversification and a negative function of asset volatility.2 Firms with more tangible assets can borrow more privately from banks and publicly through bond issuance, which is generally easier when bonds receive higher ratings.3 Since larger firms are generally more diversified, we expect them to have a lower probability of bankruptcy at a given leverage ratio and thus, greater debt capacity. Firms with higher growth rates and lower volatility of earnings and valuation also are predicted to have lower bankruptcy risk and higher debt capacity. These financing constraint and bankruptcy risk considerations can also reduce