This thesis studies the choice of financial advisors in cross-border M&As in Europe using a sample of 598 cross-border M&As from 2000 to 2012, where the firms are from the 12 European countries that adopted the euro as their currency in 1999. My study expands the work of Francis et al. (2014) to European acquirers and investigates if the same kind of home preference of shareholders and acquirers exists in Europe than in the U.S. Additionally, I examine how the ongoing process towards a single M&A market has affected the choice of financial advisors in the European Union and how it differs from deals done elsewhere. I find that the same kind of home preference by shareholders and acquirers that exits in the U.S. does not exist in Europe. In fact, the choice of financial advisors does not explain abnormal returns at all, and the number of transactions advised by the Home and Expert advisors is almost the same. I also I find that firms are more likely to use home advisors if the target country is one of the 12 European countries that adopted the euro in the first stage. This indicates that the process towards a single M&A market has reduced diffrences between corporate practices in the European Union. However, any strong conclusions cannot be made based on my study as my research suggests that the financial advisor classification to Home and Expert advisors may not be the best indicator to examine the choice of financial advisors at all. It is problematic to use two competing hypotheses because they are not mutually exclusive. Therefore, my study suggests that a new method should be developed to explore the choice of financial advisors in cross-border M&As.
