Download or read book Effects of Cross-listing on Valuation and Firm Performance [MBA Thesis a Ccompanied by a CD-ROM] written by and published by . This book was released on 2014 with total page 79 pages. Available in PDF, EPUB and Kindle. Book excerpt: The main objective of this study was to examine the effects of regional cross-listing on firm value and performance on Kenyan firms. The specific research objectives for this study were: (i) to determine the effect of cross-listing on valuation; (ii) to determine the effect of cross-listing on profitability and growth; (iii) to determine the effect of cross-listing on liquidity and leverage and; (iv) to determine the effect of cross-listing on operational performance. The scope of the study focused on 5 cross-listed firms whose primary listing is the NSE. Thus, conducting a census the study analyzed data from firms? financial statements and the NSE daily market averages and analyzed the firms? value, profitability and growth, liquidity and leverage and, operational performance to examine the differences prior and subsequent to listing. The study conducted a time series analysis, taking into consideration the independence of the variables are concerned with a time series data set, thus sought to examine the evolution of the variables over time using data spanning seven years i.e. three years before cross-listing, the year of cross-listing and three years after cross-listing. The study further subjected the results to a univariate analysis in order to examine the significance of the findings using the paired t-test for the firms Tobin?s Q, liquidity and leverage, profitability and growth and operational performance. Additionally, the findings were also subjected to a correlation analysis to measure the degree of relationship between the variables under study. The results on firm value show that on average the firm value decreased after cross-listing but the results had no statistically significant difference from before and after cross-listing. Tobin?s Q and profitability had a strong correlation indicating that the change in firm value has a strong effect to the changes in the firm profitability. The results from the study on Liquidity and Leverage, using a before and after comparison from the paired t-test revealed that on average the liquidity of the firm increased while as leverage decreased. Additionally, the study also revealed that leverage and liquidity had a moderately negative correlation. Depending on the firm, profitability and growth varied and thus there was no consistent trend evident in the study. However, a before and after comparison of the variables yielded that despite the increase in profitability and growth of the firms, the results had no significant difference. The time series analysis yielded that operational performance of majority of the cross-listed firms? motive by market incentive to cross-list, increased. Jubilee Insurance was the only firm that reported an increase after cross-listing. A before and after comparison yielded that there was a decrease in operational performance but there was no statistical significant difference in the results. Additionally, liquidity and total assets had a weak positive correlation indicating that the changes in leverage does not weakly/does not correlate with the changes in total assets. The study recommends that for firms to sustain their improved firm value and financial performance post-listing, firms should not only comply with the new regulations that they have willingly subjected themselves to but, to take the extra mile to improve corporate governance, improve information disclosure exceeding the bare minimum and creating more value for shareholders.