TY  - UNPD
A1  - Truong, Huynh Sang
A1  - Walz, Uwe
T1  - Spillovers of PE investments
T2  - SAFE working paper ; No. 357
N2  - In this paper, we investigate a primary potential impact of leveraged buyout (LBOs) transactions: the effects of LBOs on the peers of the LBO target in the same industry. Using a data sample based on US LBO transactions between 1985 and 2016, we investigate the impact of the peer firms in the aftermath of the transaction, relative to non-peer firms. To account for potential endogeneity concerns, we employ a network-based instrumental variable approach. Based on this analysis, we find support for the proposition that LBOs do indeed matter for peer firms’ performance and corporate strategy relative to non-peer firms. Our study supports a learning factor hypothesis: peers gain by learning from the LBO target to improve their operational performance. Conversely, we find no evidence to support the conjecture that peers lose due to the increased competitiveness of the LBO target firm.
T3  - SAFE working paper - 357 
KW  - LBO spillovers
KW  - peer effects
KW  - IV approach
Y1  - 2022
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/64744
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-647447
UR  - https://ssrn.com/abstract=4212428
N1  - We gratefully acknowledge research support from the Leibniz Institute for Financial Research SAFE.
IS  - September 3, 2022
PB  - SAFE
CY  - Frankfurt am Main
ER  -