Junk bond market ﬁnancing became more important in mergers and corporate restructurings because:

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Junk bond market financing allows firms to have much higher debt-equity ratios than traditional sources of financing. This makes it an attractive option for firms engaging in mergers and corporate restructurings, where large amounts of financing may be necessary. Additionally, during the 1980s there was a large supply of junk bonds available, which also contributed to their increased importance in these transactions.

Junk Bond Market ﬁNancing Became More Important in Mergers and Corporate