Leveraged Buyouts and Public-to-Private Transactions

Luc Renneboog

in The Oxford Handbook of Private Equity

Published in print March 2012 | ISBN: 9780195391589
Published online September 2012 | | DOI:

Series: Oxford Handbooks

 Leveraged Buyouts and Public-to-Private Transactions

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This article analyzes leveraged buyouts and public-to-private (PTP) transactions. It studies the literature and data on announcement returns for public-to-private transactions and considers their motives. It lists the types of firms that go private, as well as the determinants of takeover premiums in leveraged buyout transactions. It also studies posttransaction value creation and the duration of private status, and views the shift to a private firm as a form of shock therapy that is used to restructure firms that create both strong short- and long-term returns. This article also addresses the questions of whether PTP transactions lead to superior organization forms compared to public firms or not.

Keywords: leveraged buyouts; public-to-private transactions; takeover premiums; posttransaction value creation; organization forms; private status; public firms

Article.  15890 words. 

Subjects: Economics ; Financial Markets ; Public Economics

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