University of Strathclyde website
Digital Collections - University of Strathclyde Library
Search Results Previous Searches E-Shelf
Login End Session
Guest
Search 'System Number= 000006261' in 'General Silo' Collection [ Sorted by: Name/Title ] Refine search
Table view Full view
Record 1 of 1 1
Add to E-Shelf
e-item icon
Link(s)
PDF for thesis T10806 PDF for thesis T10806 - (16 M)
Title The design of corporate debt : Evidence from eurobond issues made by UK companies / Maria do Rosario Correia.
Name Correia, Maria do Rosario .
Abstract This thesis provides a comprehensive analysis of the determinants for the optimal choice of contract terms on a unique type of debt instrument: Eurobonds. A discussion of corporate finance theories that postulate the use of debt contract features for mitigating financing inefficiencies provides the foundation for the development of the empirical investigation. More specifically, theories that associate the choice of debt features namely, maturity, call options, convertible options, and protective covenants with firm's and market's characteristics are discussed in detail. Emphasis is also given to the theoretical predictions about the interdependencies established between the debt features that are viewed as alternative control devises for mitigating debt-contracting costs. Panel data and simultaneous-equations estimation methods are used to regress the relevant debt features on a set of proxies for firm characteristics, market conditions, and related contract features for a sample of 377 Eurobonds issued by UK companies over the period 1986-1999. The evidence from both panel data and simultaneous-equations analyses provide strong support to the prediction that both callable and short-term debt and convertible and debt with protective covenants are used as alternative control devises to mitigate agency costs. Further evidence suggests, however, that contrary to the fundamentals guiding the choice of maturity and callability structures, the use of convertible options and protective covenants in Eurobond contracts seems to be determined by equity agency costs rather than debt agency costs. Some support is also found for the risk uncertainty theory underlying the use of convertibles and for the liquidity risk arguments regarding the choice of protective covenants. No support is found for signalling and interest tax-shield hypotheses. Some proposals for further research
Abstract on debt contract design are identified and discussed.
Publication date 2003
Name University of Strathclyde. Dept. of Accounting and Finance.
Thesis note Thesis Ph. D University of Strathclyde 2003 T10806
URI http://ethos.bl.uk/ProcessSearch.do?query=288750
Related collections
Strathclyde Theses > Business Faculty > Accounting and Finance

Powered by Digitool Contact us Electronic Library Services Library Home