 Repeated LBOs: The Case of Multiple LBO TransactionsArman Kosedag and
David Michayluk ()
Published Paper Series from Finance Discipline Group, UTS Business School, University of Technology, Sydney Abstract: Firms that undergo a second LBO transaction are unique because they have a second experience in the capital markets after being privately held. Motivations for repeated LBOs may differ from first-time LBOs—because of the past experience, the market may be able to better distinguish the competing motivations that have been suggested in the literature. We find that for repeated LBOs, the market response is more strongly positive than that typically found for first-time LBOs. The market reaction is also strongly related to a variant of Tobin'Q, implying that the timing of the LBO may coincide with a low perception in market value. It is not surprising that the majority of the repeated LBOs were performed following the 1987 stock market crash. It appears that the instigators of the LBO believed the price was undervalued and their experience let them act accordingly. Pages: 12 pages Published as: Kosedag, A. and Michayluk, D., 2004, "Repeated LBOs - The Case of Multiple LBO Transactions", Quarterly Journal of Business and Economics, 43(1/2), 111-122. There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:uts:ppaper:2004-2 Access Statistics for this paper More papers in Published Paper Series from Finance Discipline Group, UTS Business School, University of Technology, Sydney PO Box 123, Broadway, NSW 2007, Australia. Contact information at EDIRC. |
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