Cross-Listings and M&A Activity: Transatlantic Evidence


  • We thank an anonymous referee, Ossi Haapaniemi, Seppo Ikäheimo, Markku Kaustia, Matti Keloharju, Claes von Heiroth, Tomi Seppälä, as well as seminar participants at the Helsinki School of Economics—Swedish School of Economics joint seminar and at Korea University for their comments. We are grateful to Pekko Tonteri for excellent research assistance. We thank the Foundation for Economic Education, Helsinki School of Economics Foundation, and Jenny and Antti Wihuri Foundation for financial support. Parts of this research were completed while Tolmunen was at Helsinki School of Economics and Tulane University. The opinions presented here do not necessarily reflect those of his present employer.


We analyze whether European firms choose to list shares in the US to facilitate acquisitions. Evidence from a sample of 547 European companies shows that cross-listed firms are significantly more active in acquiring US companies than are their domestically listed peers. This pattern holds even after we account for self-selection in the cross-listing decision. Cross-listed firms are also more likely to use equity payment in large transactions, but after taking self-selection into account, transaction size becomes the key determinant of the use of equity. After cross-listing, the proportion of aggregate M&A volume financed with equity increases.