Structured finance and the boundaries of the firm: the case of project finance
Autor(a) principal: | |
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Data de Publicação: | 2021 |
Outros Autores: | |
Tipo de documento: | Artigo |
Idioma: | eng |
Título da fonte: | Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
Texto Completo: | http://hdl.handle.net/10400.14/40299 |
Resumo: | We examine the factors that influence public firms’ choice between project finance over internally organized investment projects. Using a large sample of syndicated deals closed between 2000 and 2020 in conjunction with Datastream data, we find that economies of scale, agency costs of debt, and information asymmetry arguments affect the choice of on- versus off-balance-sheet funding. As project finance deals have higher borrowing costs than comparable corporate financing deals, we show that other firm-level countervailing benefits play a key role in the sponsoring firms’ choice: borrowers choose project over corporate financing when they are relatively larger, less profitable and creditworthy, and seek long-term financing; and switchers resorting to project finance tend be more levered and to have larger growth opportunity sets. |
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Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
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Structured finance and the boundaries of the firm: the case of project financeProject financingCorporate financingSyndicated loansDebt financing choiceWe examine the factors that influence public firms’ choice between project finance over internally organized investment projects. Using a large sample of syndicated deals closed between 2000 and 2020 in conjunction with Datastream data, we find that economies of scale, agency costs of debt, and information asymmetry arguments affect the choice of on- versus off-balance-sheet funding. As project finance deals have higher borrowing costs than comparable corporate financing deals, we show that other firm-level countervailing benefits play a key role in the sponsoring firms’ choice: borrowers choose project over corporate financing when they are relatively larger, less profitable and creditworthy, and seek long-term financing; and switchers resorting to project finance tend be more levered and to have larger growth opportunity sets.Veritati - Repositório Institucional da Universidade Católica PortuguesaAlves, Paulo P.Pinto, João M.2023-02-20T15:48:01Z2021-11-172021-11-17T00:00:00Zinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/articleapplication/pdfhttp://hdl.handle.net/10400.14/40299enginfo:eu-repo/semantics/openAccessreponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãoinstacron:RCAAP2023-07-12T17:45:50Zoai:repositorio.ucp.pt:10400.14/40299Portal AgregadorONGhttps://www.rcaap.pt/oai/openaireopendoar:71602024-03-19T18:33:01.258039Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informaçãofalse |
dc.title.none.fl_str_mv |
Structured finance and the boundaries of the firm: the case of project finance |
title |
Structured finance and the boundaries of the firm: the case of project finance |
spellingShingle |
Structured finance and the boundaries of the firm: the case of project finance Alves, Paulo P. Project financing Corporate financing Syndicated loans Debt financing choice |
title_short |
Structured finance and the boundaries of the firm: the case of project finance |
title_full |
Structured finance and the boundaries of the firm: the case of project finance |
title_fullStr |
Structured finance and the boundaries of the firm: the case of project finance |
title_full_unstemmed |
Structured finance and the boundaries of the firm: the case of project finance |
title_sort |
Structured finance and the boundaries of the firm: the case of project finance |
author |
Alves, Paulo P. |
author_facet |
Alves, Paulo P. Pinto, João M. |
author_role |
author |
author2 |
Pinto, João M. |
author2_role |
author |
dc.contributor.none.fl_str_mv |
Veritati - Repositório Institucional da Universidade Católica Portuguesa |
dc.contributor.author.fl_str_mv |
Alves, Paulo P. Pinto, João M. |
dc.subject.por.fl_str_mv |
Project financing Corporate financing Syndicated loans Debt financing choice |
topic |
Project financing Corporate financing Syndicated loans Debt financing choice |
description |
We examine the factors that influence public firms’ choice between project finance over internally organized investment projects. Using a large sample of syndicated deals closed between 2000 and 2020 in conjunction with Datastream data, we find that economies of scale, agency costs of debt, and information asymmetry arguments affect the choice of on- versus off-balance-sheet funding. As project finance deals have higher borrowing costs than comparable corporate financing deals, we show that other firm-level countervailing benefits play a key role in the sponsoring firms’ choice: borrowers choose project over corporate financing when they are relatively larger, less profitable and creditworthy, and seek long-term financing; and switchers resorting to project finance tend be more levered and to have larger growth opportunity sets. |
publishDate |
2021 |
dc.date.none.fl_str_mv |
2021-11-17 2021-11-17T00:00:00Z 2023-02-20T15:48:01Z |
dc.type.status.fl_str_mv |
info:eu-repo/semantics/publishedVersion |
dc.type.driver.fl_str_mv |
info:eu-repo/semantics/article |
format |
article |
status_str |
publishedVersion |
dc.identifier.uri.fl_str_mv |
http://hdl.handle.net/10400.14/40299 |
url |
http://hdl.handle.net/10400.14/40299 |
dc.language.iso.fl_str_mv |
eng |
language |
eng |
dc.rights.driver.fl_str_mv |
info:eu-repo/semantics/openAccess |
eu_rights_str_mv |
openAccess |
dc.format.none.fl_str_mv |
application/pdf |
dc.source.none.fl_str_mv |
reponame:Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) instname:Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação instacron:RCAAP |
instname_str |
Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação |
instacron_str |
RCAAP |
institution |
RCAAP |
reponame_str |
Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
collection |
Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) |
repository.name.fl_str_mv |
Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos) - Agência para a Sociedade do Conhecimento (UMIC) - FCT - Sociedade da Informação |
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1799132056175771648 |