Three essays on financial intermediaries and capital markets

This dissertation comprises three related papers that examine different aspect of financial intermediation and its impact on corporations in capital market.; The first paper investigates the factors that may influence US acquiring firms in choosing financial advisors when taking over foreign targets and examines the impact of this choice on announcement effects. The analysis shows that acquiring firms with US advisors experience significantly higher announcement effects in all cash paid transactions and this pattern holds even after I include other control variables.; The second paper investigates the choice of financial advisors of corporations and the important factors associated with regard to the decision of retaining them or switching to different intermediaries during the life cycle of corporations. For firms in the first group that had only issued equity(ies), I find that those who retain their previous equity underwriters experience significantly lower abnormal returns in stock paid transactions and that the previously related underwriters can solicit subsequent M&As by providing more optimistic recommendations. In contrast, for firms that had conducted M&As repeatedly within five years prior to the announcement, acquiring firms experience positive and significantly higher announcement effects if they stay with the same financial advisors in all the M&As and it is the previous M&A announcement effect that increases the likelihood that acquiring firms choose prior related financial advisors again in current transactions.; The third paper studies the role of intermediation in corporations' going public process when the intermediaries are not private institutions. The analysis shows that the issuing firms with political connections experience preferential terms in the process of going public.