Clas Bergström

We analyze the magnitude and determinants of private equity sponsored buyouts' impact on the operating profitability in Swedish buyout companies exited between 1998 and H1 2006. Whereas previous empirical studies have primarily been biased towards reverse LBOs, this article analyzes buyouts irrespective of exit type. We perform an industry adjusted event study to detect abnormal operating performance and impact on the companies' employees. Our analysis suggests that buyouts have a significant positive impact on the companies' operating performance. Further, we find that measurable variables commonly associated with the private equity value creation process, such as wage-level reductions, labor force restructuring, leverage and management ownership, have a low explanatory value for the magnitude of the operating impact.

This paper investigates the effect of strict segmentation on pricing in the context of the Chinese stock markets. The paper demonstrates that information asymmetry between foreign investors and domestic investors, liquidity effects, diversification effects, clientele bias, risk-free return differentials between foreign and domestic investors, and foreign exchange risks are significant factors in explaining discounts on shares that can only be owned by foreign investors.

This paper analyzes the economic consequences of a proposal from the EU Commission: The Amended Proposal for a Thirteenth Council Directive on Company Law, Concerning Takeover and Other General Bids (1990). By implementing the Equal Bid Principle, the Directive enforces a potential bidder to extend the same tender offer price to all shareholders. The paper demonstrates that it is likely that the effect of the Equal Bid Principle is directly opposed to the declared goal of protecting the economic interests of shareholders in the target company. Moreover, it tends towards a direction opposite to the declared goal of stimulating corporate acquisitions.