This paper empirically tests whether international acquisitions - in contrast to their domestic counterparts - on average create value for the shareholders of acquiring firms. We find that whereas US international acquisitions in Britain and Canada create no value, US acquisitions in Continental Europe create significant value. We try to explain these results by examining: (1) the governance characteristics of the acquiring firms; (2) the competitiveness of the market for corporate control in the different countries; and (3) the characteristics of the acquisition and the acquiring firms. Our results suggest that in the main, investors do not consider international expansion through acquisitions as a worthwhile investment unless the acquiring firm has intangible assets to exploit abroad.