CEO country-specific experience and cross-border mergers and acquisitions

We provide evidence that U.S. firms have a significantly higher probability of acquiring targets in countries where their CEOs have studied or worked. This finding is robust to alternative measures of CEO country-specific experience, samples or model specifications, and to controlling for endogeneity and target country industry specialization. Moreover, deal-level evidence suggests a reassurance effect. CEO experience has no effect on announcement returns or long-run operating performance on average but is associated with significantly better performance in risky environments. We also provide additional evidence to disentangle alternative hypotheses and explore the role of corporate governance in determining deal outcomes.