Corporate control and the choice of investment financing: the case of corporate acquisitions in India

The market for corporate control offers a rich framework to study the interaction between investment and financing decisions. Do corporations have specific preferences means of acquisitions, such using cash or equity pay claims target firm’s shareholders? This builds unique sample 1041 acquisitions over period 2000–2018 in India, major emerging economy with fast-growing capital markets. investigates separately payment sources multinomial logit nested models. First, we find that different factors explain Second, decision is best explained by target’s relative size, greater tender offers, cross-border deals, reserves. Third, findings are most aligned pecking order theory cost considerations.