Arbeitspapier

Does the tenure of private equity investment improve the performance of European firms?

The paper investigates whether the presence and tenure of Private Equity (PE) investment in European companies improves their performance. Previous studies documented the unambiguous merit of a buyout during the 1980s and 1990s for listed firms in the US and UK markets. This study analyzes such influences in both listed and unlisted European firms during 2002-2007. Our analysis suggests that shortterm PE investments have, on average, a detrimental effect on firm performance. The performance of a firm that has PE backing is lower than that of a firm without PE backing in the first year of PE investment. Such an effect disappears if PE investments remain in the firm for an uninterrupted six-year term.

Language
Englisch

Bibliographic citation
Series: DIW Discussion Papers ; No. 990

Classification
Wirtschaft
Corporate Culture; Diversity; Social Responsibility
Investment Banking; Venture Capital; Brokerage; Ratings and Ratings Agencies
Mergers; Acquisitions; Restructuring; Voting; Proxy Contests; Corporate Governance
Subject
Private equity financing
corporate finance
Private Equity
Unternehmensfinanzierung
Dauer
Unternehmensentwicklung
Europa

Event
Geistige Schöpfung
(who)
Badunenko, Oleg
Baum, Christopher F.
Schäfer, Dorothea
Event
Veröffentlichung
(who)
Deutsches Institut für Wirtschaftsforschung (DIW)
(where)
Berlin
(when)
2010

Handle
Last update
10.03.2025, 11:41 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Badunenko, Oleg
  • Baum, Christopher F.
  • Schäfer, Dorothea
  • Deutsches Institut für Wirtschaftsforschung (DIW)

Time of origin

  • 2010

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