Does going private add value through operating improvements?

Ayash, Brian; Schütt, Harm H.

doi:10.1016/j.jcorpfin.2016.07.015

Cited by 26 publications

(8 citation statements)

References 45 publications

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“…Cohn, Mills and Towery (2014) and Leslie and Oyer (2008), using a sample of US LBOs, find little or no evidence of operating improvements following a buyout. Similarly, Ayash and Schütt (2016) find no economically significant improvement in operating performance following buyouts, and Ayash and Rastad (2017) question productivity improvement claims in prior literature. In a UK buyout context, Goergen, O' Sullivan andWood (2014a, 2014b) show that the performance and productivity of IBOs tend to decrease post-transaction.…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 94%

“…In fact, recent evidence has provided some puzzling results about the real outcome of buyout transactions. Several studies show positive effects of buyouts on the productivity and innovation of target firms (Amess, Stiebale and Wright, 2016;Davis et al, 2014;Lerner, Sorensen and Strömberg, 2011); others have questioned the post-buyout results of performance and productivity improvements (Ayash and Rastad, 2017;Ayash and Schütt, 2016;Bharath, Dittmar and Sivadasan, 2014;Cohn, 1 https://www.ft.com/content/6fd92a0c-437d-11dc-a065-0000779fd2ac. 2 https://www.ft.com/content/b784e306-5aad-11e9-9dde-7aedca0a081a.…”

Section: Introductionmentioning

confidence: 99%

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Public-to-Private Buyouts and Innovation

2018

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Section: Literature Review and Hypothesis Developmentmentioning

confidence: 94%

Section: Introductionmentioning

confidence: 99%

Public-to-Private Buyouts and Innovation

2018

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“…Another 9% were sold to listed companies and 12% went bankruptcy. The bankruptcy rate of LBO companies pointed out in the 1980s was 27%, and it declined to 17% from 1990 to 2006 [12].…”

Section: Liquiditymentioning

confidence: 96%

The Effects of Mergers and Acquisitions on Corporate Management and Financial Performance

He¹

2022

Advances in Economics, Business and Management Research

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Over the past thirty-five years, there have been more than one million M&A cases worldwide, but the failure rate is 70-90%. Although mergers and acquisitions are useful approaches for corporations to expand the scale, it is double-edged. Therefore, it is important to critically examine its influence on corporate performance on both positive and negative sides, in order to warn companies not to choose M&A blindly. This paper firstly emphasizes that the volatility of staff turnover rate will negatively affect corporate managerial performance after consolidation. After that, this paper points out that how will the probability, liquidity and stock price will change due to the announcement of M&A. Furthermore, the paper explains how M&A will bring different effects to the business, owing to the distinction between different M&A instruments. The whole research mainly collects secondary data from previous studies and analyses it further with reference to LVHM's consolidated financial statements.

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“…However, there exist a number of studies that have cast doubt on the improvements of performance, productivity and innovation after PE investment (see e.g. Ayash and Schütt, 2016; Bharath, Dittmar and Sivadasan, 2014; Cumming, Peter and Tarsalewska, 2020).…”

Section: Private Equity Portfolio Companies: Background and Literaturementioning

confidence: 99%

“…However, as discussed earlier, the existing evidence provides conflicting results on the effect of the PE buyouts on productivity improvement of the target firms (Cumming, Peter and Tarsalewska, 2020). Several studies argue that target firms' productivity improves as a result of monitoring by PE investors and discipline imposed by debt providers (Ahlers et al, 2017;Amess, Stiebale and Wright, 2015;Davis et al, 2014), whereas several others find that PE targets are associated with lower post-investment productivity (Ayash and Schütt, 2016;Goergen, O'Sullivan and Wood, 2014;Weir, Jones and Wright, 2015). Given the mixed findings on productivity improvement of the target firms, we investigate whether PE firms have specific preferences over choosing target firms with a relatively lower or higher-than-average productivity in their sector size range.…”

Section: Private Equity Choice Of Targets: Hypothesesmentioning

confidence: 99%

Determining the Characteristics of the Private Equity Targets: UK Evidence

Wilson

Amini

Wright

2021

British J of Management

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Academic research on private equity (PE) has been concerned with the management of PE funds, the returns to investors from investments in PE relative to the returns available in public equity markets and, more predominantly, the analysis of the post‐investment performance of PE portfolio firms. There has been less research on how PE firms select their investments and the characteristics of their targeted firms. We derive hypotheses, from an agency perspective, on the firm‐level characteristics of PE‐targeted firms. Utilizing data on the population of private companies in the UK, we identify those firms that have received PE investment from the pool of potential investees within the population of private companies and known buyouts, and examine their pre‐investment characteristics. Using panel logit regression, we estimate multivariate models determining the probability of PE acquisition and examine the multivariate profiles of targeted firms in relation to our hypotheses on PE selection.

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Does going private add value through operating improvements?

Cited by 26 publications

References 45 publications

Public-to-Private Buyouts and Innovation

Public-to-Private Buyouts and Innovation

The Effects of Mergers and Acquisitions on Corporate Management and Financial Performance

Determining the Characteristics of the Private Equity Targets: UK Evidence

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