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

See all articles by Ann‐Kristin Achleitner

Ann‐Kristin Achleitner

Technische Universität München - Center for Entrepreneurial and Financial Studies

André Betzer

BUW- Schumpeter School of Business and Economics

Marc Goergen

IE Business School, IE University; European Corporate Governance Institute (ECGI)

Bastian Hinterramskogler

Technische Universität München - Center for Entrepreneurial and Financial Studies (CEFS)

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

Achleitner, Ann-Kristin and Betzer, André and Goergen, Marc and Hinterramskogler, Bastian, Private Equity Acquisitions of Continental European Firms - The Impact of Ownership and Control on the Likelihood of Being Taken Private (June 17, 2010). European Financial Management, Forthcoming; Best Paper Prize, 7th International Conference on Corporate Governance, Birmingham Business School. Available at SSRN: https://ssrn.com/abstract=1319836 or http://dx.doi.org/10.2139/ssrn.1319836

Ann-Kristin Achleitner

Technische Universität München - Center for Entrepreneurial and Financial Studies ( email )

Arcisstr. 21
Munich, D-80290
Germany
+49 89 289 25181 (Phone)

André Betzer

BUW- Schumpeter School of Business and Economics ( email )

Gaußstraße 20
Wuppertal
Germany

HOME PAGE: http://finance.uni-wuppertal.de/index.php?id=1153

Marc Goergen

IE Business School, IE University ( email )

Finance Department
Maria de Molina, 12
Madrid, 28006
Spain

HOME PAGE: http://www.ie.edu/business-school/faculty-and-research/faculty/marc-goergen/

European Corporate Governance Institute (ECGI) ( email )

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

HOME PAGE: http://www.ecgi.org

Bastian Hinterramskogler (Contact Author)

Technische Universität München - Center for Entrepreneurial and Financial Studies (CEFS) ( email )

Arcisstr. 21
Munich, 80333
Germany

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