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The Impact of Lbos on Investment Policies and Operations of Acquired French Firms

Philippe Desbrières () and Alain Schatt ()

Working Papers CREGO from Université de Bourgogne - CREGO EA7317 Centre de recherches en gestion des organisations

Abstract: This paper evaluates the extent that French LBO targets' investment policy and operations can account for their overperformance discrepancy. Our empirical study has been carried out on 132 French LBOs between 1989 and 1994. The results show that the abnormal plunge in economic return cannot be explained by overinvestments or by inefficient working capital management. Nevertheless, abnormal increases in wages, supplies and/or sales price reductions appear to be prominent.

Keywords: Leveraged buy-out; performance; investment policy; operations (search for similar items in EconPapers)
JEL-codes: G31 (search for similar items in EconPapers)
Date: 2002-10
Note: version française publiée dans Finance Contrôle Stratégie, vol.5, n°4, décembre 2002.
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Published in Finance Contrôle Stratégie, vol.5, n°4, décembre 2002.

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Persistent link: http://EconPapers.repec.org/RePEc:dij:wpfarg:1021002

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Angèle Renaud, CREGO, 2 Bd Gabriel, BP 26611, 21066 Dijon Cedex, France

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