Publication
Title
Stock listing and financial flexibility
Author
Abstract
A stock listing usually reflects easy access to external equity financing. Although scant empirical evidence exists on the matter, the literature suggests that the enhanced standing towards creditors which would result in easier access to debt financing is an extra advantage of being publicly quoted. This paper tests whether a stock listing leads to more flexibility of debt financing, using a data set of listed and comparably large unlisted companies. The data reveals that listing mainly increases the flexible use of debt financing. The difference between listed and unlisted firms is most apparent when investment opportunities tend to arrive in low-cash-flow states. Furthermore, as the unlisted firms in the dataset are all large consolidating business groups, the results indicate that a group structure does not substitute for listing. The results are robust to different estimation methods.
Language
English
Source (journal)
Journal of business research. - New York
Publication
New York : 2011
ISSN
0148-2963
Volume/pages
64:5(2011), p. 483-489
ISI
000288311900007
Full text (Publisher's DOI)
UAntwerpen
Faculty/Department
Research group
Publication type
Subject
External links
Web of Science
Record
Identification
Creation 31.05.2011
Last edited 17.07.2017