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A Framework for Examining the Heterogeneous Opportunities of Value Creation in Private Equity Buyouts

Author

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  • Francesco Castellaneta

    (SKEMA Business School - SKEMA Business School, GREDEG - Groupe de Recherche en Droit, Economie et Gestion - UNS - Université Nice Sophia Antipolis (1965 - 2019) - CNRS - Centre National de la Recherche Scientifique - UniCA - Université Côte d'Azur)

  • Mike Wright

    (Imperial College Business School)

  • Simon Hannus

    (Prevestor Partners)

Abstract

PE firms and buyouts have emerged as a field of significant interest for academic research and attracted the increasing attention of policy makers, public opinion and popular press. In particular, there is a strong debate on how private equity firms create value in buyout investments. Notwithstanding this widespread interest in value creation in private equity, there is a lack of research offering an overall view of the various mechanisms by which value can be created in buyout investments. We contribute to shed new light on this issue by reviewing the body of research on value creation and by proposing an overall framework for mapping the heterogeneous opportunities to create value.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Francesco Castellaneta & Mike Wright & Simon Hannus, 2019. "A Framework for Examining the Heterogeneous Opportunities of Value Creation in Private Equity Buyouts," Post-Print halshs-01948469, HAL.
    • Handle: RePEc:hal:journl:halshs-01948469
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    References listed on IDEAS

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    1. Mike Wright & Luc Renneboog & Tomas Simons & Louise Scholes, 2006. "Leveraged Buyouts in the U.K. and Continental Europe: Retrospect and Prospect," Journal of Applied Corporate Finance, Morgan Stanley, vol. 18(3), pages 38-55, June.
    2. Zahra, Shaker A., 1995. "Corporate entrepreneurship and financial performance: The case of management leveraged buyouts," Journal of Business Venturing, Elsevier, vol. 10(3), pages 225-247, May.
    3. Yermack, David, 1996. "Higher market valuation of companies with a small board of directors," Journal of Financial Economics, Elsevier, vol. 40(2), pages 185-211, February.
    4. Zarutskie, Rebecca, 2010. "The role of top management team human capital in venture capital markets: Evidence from first-time funds," Journal of Business Venturing, Elsevier, vol. 25(1), pages 155-172, January.
    5. D. Zhou & R. Jelic & M. Wright, 2014. "SMBOs: Buying Time or Improving Performance?," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 35(2), pages 88-102, March.
    6. Wright, Mike & Thompson, Steve & Robbie, Ken, 1992. "Venture capital and management-led, leveraged buy-outs: A European perspective," Journal of Business Venturing, Elsevier, vol. 7(1), pages 47-71, January.
    7. Mike Wright & Ken Robbie & Steve Thompson & Ken Starkey, 1994. "Longevity and the life‐cycle of management buy‐outs," Strategic Management Journal, Wiley Blackwell, vol. 15(3), pages 215-227, March.
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    Cited by:

    1. Herrera-Echeverri, Hernan & Nandy, Debarshi K. & Fragua, Daniel, 2022. "The role of private equity investments on exports: Evidence from OECD countries," Journal of Multinational Financial Management, Elsevier, vol. 65(C).
    2. Hammer, Benjamin & Marcotty-Dehm, Nikolaus & Schweizer, Denis & Schwetzler, Bernhard, 2022. "Pricing and value creation in private equity-backed buy-and-build strategies," Journal of Corporate Finance, Elsevier, vol. 77(C).

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    More about this item

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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