PRIVATE EQUITY AND THE COMPETITIVENESS OF POLISH ENTERPRISES

Ilona Falat–Kilijanska ()
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Ilona Falat–Kilijanska: Wroclaw University of Economics

Oeconomia Copernicana, 2012, vol. 3, issue 1, 89-114

Abstract: The objective of the article is private equity and venture capital investments and their influence for companies activity. The article presents author’s own studies of the private equity investment influence for the enterprise activity. Comparing venture-backed firms and others shows, that venture-backed companies patent more than others firms and their ideas are higher technological and economic values. The vast majority of polish managers believe their company would not have existed or would have grown less rapidly without venture capital. Respondents also believe that venture capital funding encouraged employment, investment, R&D spending and export. Existing evidence suggests a positive impact of venture capital on firm performance. The study allowed to determine the role of the private equity fund. Private equity is used to develop or introduce new technologies, product development, increase their range and improve the quality of production, for increased investment in the brand, building (or expanding) distribution channels, as well as to increase spending to improve corporate image employing highly skilled workers or to finance changes in organizational structure. This means that the capital provided by the fund is primarily used for activities that increase shareholder value. The funding of private equity capital firms become an active member of M&A market, making the consolidation of the industry and at the same time becoming a leading player in the market. All the above actions serve to increase the level of competitiveness of the operator, resulting in improving its market position, and thus the financial results. An important source of empirical data are performed author’s own surveys and interviews with representatives of shareholding companies, as well as with private equity fund managers. Years of research: 1998 – 2009. The study used several research methods: a descriptive method, the method of comparative analysis, using the method of critical analysis and synthesis applications.

Keywords: private equity investments; a competitiveness; innovation (search for similar items in EconPapers)
JEL-codes: G23 G24 G32 (search for similar items in EconPapers)
Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:pes:ieroec:v:3:y:2012:i:1:p:89-114

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