Performance Benefits of Tight Control

Posted: 22 May 2019

See all articles by Andrej Gill

Andrej Gill

Goethe University Frankfurt - Faculty of Economics and Business Administration

Nikolai Visnjic

Goethe University Frankfurt

Multiple version iconThere are 2 versions of this paper

Date Written: June 18, 2013

Abstract

This study investigates the transition from being a listed company with a dispersed ownership structure to being a privately held company with a concentrated ownership structure. We consider a sample of private equity backed portfolio companies to evaluate the consequences of the corporate governance changes on operational performance. Our analysis shows significant positive abnormal growth in several performance ratios for the private period of our sample companies relative to comparable public companies. These performance differences come from the increase in ownership concentration after the leveraged buyout transaction.

Keywords: private equity, leveraged buyouts, active shareholders, ownership concentration, corporate governance

JEL Classification: G23, G24, G32, G34

Suggested Citation

Gill, Andrej and Visnjic, Nikolai, Performance Benefits of Tight Control (June 18, 2013). SAFE Working Paper No. 24. Available at SSRN: https://ssrn.com/abstract=2281230 or http://dx.doi.org/10.2139/ssrn.2281230

Andrej Gill (Contact Author)

Goethe University Frankfurt - Faculty of Economics and Business Administration ( email )

Grüneburgplatz 1
Frankfurt am Main, D-60323
Germany

Nikolai Visnjic

Goethe University Frankfurt ( email )

Grüneburgplatz 1
Frankfurt am Main, 60323
Germany

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