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Global leveraged buyout deal performance: A cross-border cross-cultural perspective

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  • Jia, Xiao
  • McCourt, Maurice

Abstract

Using a novel and comprehensive dataset, we find that the deal values of cross-border private equity-backed leveraged buyouts are significantly larger than domestic ones, but after controlling for the effects of diseconomies of scale, the performance of cross-border deals is not significantly different from domestic deals. We identify three channels to enhance cross-border leveraged buyout performance: more deal experience of the private equity sponsor, reduced communication costs, and spillover effects of institutional quality from the sponsor country to the target.

Suggested Citation

  • Jia, Xiao & McCourt, Maurice, 2022. "Global leveraged buyout deal performance: A cross-border cross-cultural perspective," Pacific-Basin Finance Journal, Elsevier, vol. 71(C).
    • Handle: RePEc:eee:pacfin:v:71:y:2022:i:c:s0927538x21001840
    DOI: 10.1016/j.pacfin.2021.101677
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    More about this item

    Keywords

    Cross-border leveraged buyout; Diseconomies of scale; Communication cost; Spillover effect;
    All these keywords.

    JEL classification:

    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance

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