Private Equity Acquisitions of Continental European Firms - The Impact of Ownership and Control on the Likelihood of Being Taken Private
European Financial Management, Forthcoming
Best Paper Prize, 7th International Conference on Corporate Governance, Birmingham Business School
53 Pages Posted: 27 Dec 2008 Last revised: 5 Aug 2011
Date Written: June 17, 2010
Abstract
This paper studies the motives behind private equity acquisitions of publicly listed firms in continental Europe. As corporate control and ownership in continental Europe tend to be highly concentrated, we argue that it is important to take into account the incentives of the incumbent large shareholder to monitor the management and the private benefits of control the latter may derive from the firm when measuring the likelihood of the firm being taken over by a private equity investor. We find strong and consistent evidence that both have a significant impact on the likelihood of a private equity acquisition.
Keywords: Private equity, going private, continental Europe, ownership
JEL Classification: G34, G32, G15
Suggested Citation: Suggested Citation
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