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- Title
The Effects of the Specialization of Private Equity Firms on their Exit Strategy.
- Authors
Rigamonti, Damiana; Cefis, Elena; Meoli, Michele; Vismara, Silvio
- Abstract
We investigate how industry and stage specialization of Private Equity (PE) firms affect the likelihood to exit investments by means of trade sales, Initial Public Offerings (IPOs), or Secondary Buyouts (SBOs). Our empirical analysis relies on competing risks models. Using a sample of 818 Leveraged Buyouts (LBOs) by US and European PE firms over the period 2000-2015, we find that both industry and stage specializations of PEs increase the likelihood of exiting via IPO, whereas only industry specialization positively affects the likelihood of divesting through a trade sale. Finally, SBOs are more likely for non-specialized investors.
- Subjects
PRIVATE equity funds; INVESTMENTS; GOING public (Securities); LEVERAGED buyouts; INVESTORS
- Publication
Journal of Business Finance & Accounting, 2016, Vol 43, Issue 9/10, p1420
- ISSN
0306-686X
- Publication type
Article
- DOI
10.1111/jbfa.12221