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Hege, Ulrich
, Lovo, Stefano, Slovin, Myron B. and Sushka, Marie E.
(2018)
Divisional Buyouts by Private Equity and the Market for Divested Assets.
Journal of Corporate Finance, 53.
pp. 21-37.
This is the latest version of this item.
Abstract
We study the role and performance of private equity (PE) in corporate asset sales. Corporate sellers obtain significantly positive excess returns in PE deals, gains in wealth significantly greater than for intercorporate asset sales. Based on exit valuations for 98% of PE deals, we find gains in enterprise value in buyouts are significantly greater than for benchmark firms. Corporate seller excess returns are positively correlated with subsequent gains in asset enterprise value. A parsimonious auction model suggests that only restructuring capabilities of PE (not acquisition of undervalued assets) can explain the pattern of the gains generated in these PE deals.
| Item Type: | Article |
|---|---|
| Language: | English |
| Date: | December 2018 |
| Refereed: | Yes |
| Uncontrolled Keywords: | Divisional buyouts, asset sales, private equity, restructuring, auction |
| JEL Classification: | G32 - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure G34 - Mergers; Acquisitions; Restructuring; Corporate Governance |
| Subjects: | B- ECONOMIE ET FINANCE |
| Divisions: | TSE-R (Toulouse) |
| Site: | UT1 |
| Date Deposited: | 13 Sep 2018 07:35 |
| Last Modified: | 02 Apr 2021 15:58 |
| OAI Identifier: | oai:tse-fr.eu:32934 |
| URI: | https://publications.ut-capitole.fr/id/eprint/26249 |
Available Versions of this Item
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Divisional Buyouts by Private Equity and the Market for Divested Assets. (deposited 06 Sep 2018 07:28)
- Divisional Buyouts by Private Equity and the Market for Divested Assets. (deposited 13 Sep 2018 07:35) [Currently Displayed]
