Leveraged Buyouts and Private Equity

Steven Kaplan () and Per Stromberg

Journal of Economic Perspectives, 2009, vol. 23, issue 1, 121-46

Abstract: In a leveraged buyout, a company is acquired by a specialized investment firm using a relatively small portion of equity and a relatively large portion of outside debt financing. The leveraged buyout investment firms today refer to themselves (and are generally referred to) as private equity firms. We describe and present time series evidence on the private equity industry, considering both firms and transactions. We discuss the existing empirical evidence on the economics of the firms and transactions. We consider similarities and differences between the recent private equity wave and the wave of the 1980s. Finally, we speculate on what the evidence implies for the future of private equity.

JEL-codes: G24 G32 G34 (search for similar items in EconPapers)
Date: 2009
Note: DOI: 10.1257/jep.23.1.121
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Citations: View citations in EconPapers (255)

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Related works:
Working Paper: Leveraged Buyouts and Private Equity (2009)
Working Paper: Leveraged Buyouts and Private Equity (2008)
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