Private equity bids in Australia: An exploratory study

Chapple, Larelle, Clarkson, Peter M. and King, Jesse J. (2010) Private equity bids in Australia: An exploratory study. Accounting and Finance, 50 1: 79-102. doi:10.1111/j.1467-629X.2009.00323.x


Author Chapple, Larelle
Clarkson, Peter M.
King, Jesse J.
Title Private equity bids in Australia: An exploratory study
Journal name Accounting and Finance   Check publisher's open access policy
ISSN 0810-5391
1467-629X
Publication date 2010-03
Year available 2009
Sub-type Article (original research)
DOI 10.1111/j.1467-629X.2009.00323.x
Volume 50
Issue 1
Start page 79
End page 102
Total pages 24
Editor Robert Faff
Place of publication Oxford, U.K.
Publisher Blackwell
Collection year 2011
Language eng
Subject C1
150201 Finance
910206 Market-Based Mechanisms
Formatted abstract
In this study, we provide an insight into how private equity players choose their targets and the bid arrangements they prefer. We test our expectations of the unique features of private equity targets using a sample of 23 listed private equity target firms during 2001–2007. We find, relative to a benchmark sample of 81 corporate targets matched by year and industry, the private equity target firms to be larger, more profitable, use their assets more efficiently, more highly levered and have greater cash flow. Multivariate testing indicates that private equity targets have relatively greater financial slack, greater financial stability, greater free cash flow and lower measurable growth prospects. All conclusions are found to be robust to a control sample of 502 takeover bids during 2001–2007.
© The Authors
Journal compilation © 2009 AFAANZ
Keyword Takeovers
Private equity
Financial slack
G34
Free cash flow
Corporate-control
Termination fees
Takeovers
Mergers
Costs
Q-Index Code C1
Q-Index Status Confirmed Code
Institutional Status UQ
Additional Notes Article first published online: 17 NOV 2009

Document type: Journal Article
Sub-type: Article (original research)
Collections: 2010 Higher Education Research Data Collection
2010 Higher Education Research Data Collection
UQ Business School Publications
 
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Citation counts: TR Web of Science Citation Count  Cited 4 times in Thomson Reuters Web of Science Article | Citations
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Created: Wed, 02 Dec 2009, 15:43:03 EST by Karen Morgan on behalf of UQ Business School