Taking China Private: The Carlyle Group, Leveraged Buyouts and Financial Capitalism in Greater China

44 Pages Posted: 28 Aug 2014

See all articles by Douglas J. Cumming

Douglas J. Cumming

Florida Atlantic University

Grant Fleming

Continuity Capital Partners

Date Written: August 26, 2014

Abstract

This paper analyses the introduction of leveraged buyouts in China and Taiwan. It focuses on how leveraged buyout firms (foreign financial intermediaries) operate in institutional environments where the state and family blockholder groups are important owners and stakeholders in the private sector. The Carlyle Group’s acquisition of three companies – Xugong Group Construction Machinery; Advanced Semiconductor Engineering; and Ta Chong Bank – provide empirical case studies of stakeholder receptiveness and views on the value of Carlyle’s firm specific resources. We find that the ability of target firms to exploit the resource advantages brought by leveraged buyout firms requires a supportive institutional framework and willingness by intermediaries to adapt their strategies to a range of stakeholders’ claims.

Keywords: Financial intermediaries, China, Taiwan, leveraged buyouts, private equity, business history, financial history, Carlyle Group, public-to-privates, financial capitalism

JEL Classification: G24, G28, G34, G38

Suggested Citation

Cumming, Douglas J. and Fleming, Grant Alan, Taking China Private: The Carlyle Group, Leveraged Buyouts and Financial Capitalism in Greater China (August 26, 2014). Available at SSRN: https://ssrn.com/abstract=2487546 or http://dx.doi.org/10.2139/ssrn.2487546

Douglas J. Cumming

Florida Atlantic University ( email )

777 Glades Rd
Boca Raton, FL 33431
United States

HOME PAGE: http://booksite.elsevier.com/9780124095373/

Grant Alan Fleming (Contact Author)

Continuity Capital Partners ( email )

GPO Box 314
Canberra, Australian Capital Territory 2601
Australia

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