Skill, syndication, and performance: Evidence from leveraged buyouts

Jared Stanfield

Journal of Corporate Finance, 2020, vol. 65, issue C

Abstract: This paper studies why buyout firms syndicate and how this influences buyout performance. I find evidence that skill plays an important role in syndication and its effect on performance. The results suggest low-skill firms utilize syndication to pool skill, resources, and information to overcome firm-specific deficiencies and improve performance, but no such effect exists for high-skill firms. This evidence is robust to potential endogeneity concerns and other alternative explanations. Additionally, this paper is the first to use a robust statistical network methodology studying the formation of syndication networks that allows for a consistent estimation of effects within the network despite the lack of independence among observations.

Keywords: Syndication; Leveraged buyout; Private equity; Boundaries of the firm; Social networks (search for similar items in EconPapers)
JEL-codes: G23 G24 G34 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:corfin:v:65:y:2020:i:c:s0929119917305916

DOI: 10.1016/j.jcorpfin.2019.101496

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