Domestic and cross-border M&A : when should firms hire a top-tier advisor?

We study the relevance of hiring a top-tier bank in an M&A process in domestic and cross-border deals from 1980 to 2014. We prove that under certain conditions the reputation of the advisor adds in fact value to the bidder firm. We find that Golubov et al. (2012) results, that the reputation of the financial advisor, measured by its ranking in Thomson Reuters league tables, delivers higher bidder returns, still hold, but only in public deals. When analysing deeply we find that advisor expertise and reputation can only add value to the bidder firm in specific cases: 1) in domestic deals if the target is a public firm; 2) in cross-border acquisitions in which the target is a private firm