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Equity Markets Do Not Fit All: an Analysis of Public†to†Private Deals in Continental Europe

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  • Manuela Geranio
  • Giovanna Zanotti

Abstract

Concentration of family†based ownership and recent development of private equity companies in Continental Europe suggest that the motivations and results of public†to†private (PTP) deals may differ from well†studied cases in the USA and the UK. We overview the PTP market and measure the cumulative abnormal returns (CARs) of 106 PTP deals concluded in Continental Europe from 2000 to 2005, introducing a model to explain the abnormal returns. Our results partially confirm findings of previous studies, namely, that undervalued and smaller firms register higher CARs. We additionally find that deals promoted by family owners register higher abnormal returns, whereas financial investors and private operating firms show no impact.

Suggested Citation

  • Manuela Geranio & Giovanna Zanotti, 2012. "Equity Markets Do Not Fit All: an Analysis of Public†to†Private Deals in Continental Europe," European Financial Management, European Financial Management Association, vol. 18(5), pages 867-895, November.
    • Handle: RePEc:bla:eufman:v:18:y:2012:i:5:p:867-895
    DOI: 10.1111/j.1468-036X.2010.00556.x
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    3. Dasilas, Apostolos & Grose, Chris, 2018. "The wealth effects of public-to-private LBOs: Evidence from Europe," International Review of Financial Analysis, Elsevier, vol. 58(C), pages 179-194.

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