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Malaysian government introduced Government Linked Companies Transformation Program (GLCT program) in 2004. This study aims to investigate how debt equity choices of Malaysian listed Government Linked Companies are influenced by the firm’s characteristics and corporate governance’s characteristics after the introduction of the GLCT Program. It was identified that profitability; potential growth and free cash flow determined the debt ratio of the GLCs. The outcomes from this study will assist entrepreneurs and top management of the companies in formulating better capital structure decision in respect of the mixture between debt and equity capital and provide the exercise control over capital structure planning.

Keywords: Capital structure, GLCs, debt, profitability, cash flow, corporate governance

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