Abstract
Purpose - This study identifies determinants of involuntary cross-listing of U.S. restaurant companies on the Frankfurt Stock Exchange.Design/methodology/approach - The study utilizes a mixed method design with interviews and a pooled logistic regression analysis with a panel dataset using the company-clustered standard errors to develop and test the hypotheses. Findings - The empirical investigation identifies determinants of involuntary cross-listing by examining ten factors: size, firm growth opportunities, leverage, financial flexibility, international operations, profitability, overall German economic conditions, industry growth opportunities, restaurant type, and local operations. The study finds three determinants—large size, favorable economic conditions in Germany and positive industry growth opportunities—from using a sample covering all periods of involuntary cross-listing of U.S. restaurant companies on the Frankfurt Stock Exchange. Originality/value - This study explores the phenomenon of involuntary cross-listing, which many stock exchanges have strategically adopted by simplifying listing requirements for companies already listed in other stock markets, focusing on U.S. restaurant companies. The number of involuntarily cross-listed U.S. restaurant companies greatly increased to 50% of domestically listed U.S. restaurant companies while those companies remain largely unaware of the phenomenon. The research advances understanding of involuntary cross-listings, which previously received little attention.
Purpose - This study identifies determinants of involuntary cross-listing of U.S. restaurant companies on the Frankfurt Stock Exchange.Design/methodology/approach - The study utilizes a mixed method design with interviews and a pooled logistic regression analysis with a panel dataset using the company-clustered standard errors to develop and test the hypotheses. Findings - The empirical investigation identifies determinants of involuntary cross-listing by examining ten factors: size, firm growth opportunities, leverage, financial flexibility, international operations, profitability, overall German economic conditions, industry growth opportunities, restaurant type, and local operations. The study finds three determinants—large size, favorable economic conditions in Germany and positive industry growth opportunities—from using a sample covering all periods of involuntary cross-listing of U.S. restaurant companies on the Frankfurt Stock Exchange. Originality/value - This study explores the phenomenon of involuntary cross-listing, which many stock exchanges have strategically adopted by simplifying listing requirements for companies already listed in other stock markets, focusing on U.S. restaurant companies. The number of involuntarily cross-listed U.S. restaurant companies greatly increased to 50% of domestically listed U.S. restaurant companies while those companies remain largely unaware of the phenomenon. The research advances understanding of involuntary cross-listings, which previously received little attention.