A sale and leaseback is an alternative to traditional financing in which the owner of an asset contracts to sell the asset and then to lease it from the buyer. This paper focuses on some of the motivations behind this decision. We find evidence supporting the primary theoretical reason for...

A sale and leaseback is an alternative to traditional financing in which the owner of an asset contracts to sell the asset and then to lease it from the buyer. This paper focuses on some of the motivations behind this decision. We find evidence supporting the primary theoretical reason for...

Theoretically and empirically, debt and leases have been shown to be both substitutes and complements. To explore the relation, we divide our sample into two subsets: those that exhibit a complementary relation (43% increase debt after increasing leases), and those that exhibit a substitutionary...