Do Lbo tansactions create value? an empirical analysis of Lbo transactions in the German market

• Autor(a) principal: Biermann, Gereon
• Data de Publicação: 2021
• Tipo de documento: Dissertação
• Idioma: eng
• Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
• Texto Completo: http://hdl.handle.net/10362/133354
• topic: Value creation; Private equity; Leveraged buyout; Value destruction; Domínio/Área Científica::Ciências Sociais::Economia e Gestão

This paper examines the impact of Leveraged Buyout (LBO) transactions on the performance of target companies with an emphasis on value creation. While an often-examined field is the return development of Private Equity funds over a certain period, we focus on value creation and the ability of Private Equity investors to improve companies operationally. We want to analyze relevant performance variables of companies acquired by Private Equity funds and compare those to a control group of similar companies that have not been involved in an LBO transaction. The results show that companies with LBO backgrounds tend to have a weaker performance for the analyzed period than those within the control group and suggest that LBOs do not increase the value of target companies and therefore are not creating value for their stakeholders. One of the reasons for the rather weak performance can be characterized in the large number of Secondary transactions during this period.