The influence of geography on the success of private equity: investments in listed equity

Olaf Stotz

Applied Financial Economics, 2011, vol. 21, issue 21, 1605-1615

Abstract: This article analyses short-term and long-term wealth effects of private equity investments in target companies which are already listed on a stock exchange. It also examines the importance of geography on both stock returns and accounting returns. In general, risk-adjusted short-term and long-term stock returns of target companies are positive. Also, changes in accounting returns are greater for target companies than for companies of the same industry. With respect to geography it is found that almost all of the positive returns result from private equity investments in target companies from the same country.

Keywords: private equity; accounting returns; stock returns; event study (search for similar items in EconPapers)
Date: 2011
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DOI: 10.1080/09603107.2011.587772

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