Agency, Strategic Entrepreneurship, and the Performance of Private Equity-Backed Buyouts

Agency theory has focused on buyouts as a governance and control device to increase profitability, organizational efficiency, and limited attention to growth. A strategic entrepreneurship view of buyouts incorporates upside incentives for value creation associated with growth as well as efficiency g...

Full description

Saved in:
Bibliographic Details
Published in:Entrepreneurship theory and practice 2009-01, Vol.33 (1), p.213-239
Main Authors: Meuleman, Miguel, Amess, Kevin, Wright, Mike, Scholes, Louise
Format: Article
Language:English
Subjects:
Acquisitions and mergers
Agency theory
Analysis
Business administration
Business management
Business strategies
Business studies
Buyouts
Economics and Finance
Entrepreneurs
Entrepreneurship
Equity
Human capital
Humanities and Social Sciences
Management buyout
Private equity
Strategic management
Strategic planning (Business)
Studies
United Kingdom
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:Agency theory has focused on buyouts as a governance and control device to increase profitability, organizational efficiency, and limited attention to growth. A strategic entrepreneurship view of buyouts incorporates upside incentives for value creation associated with growth as well as efficiency gains. In this paper, we develop the complementarity between agency theory and strategic entrepreneurship perspectives to examine the performance implications for different types of buyouts. Further, we study how the involvement of private equity (PE) firms is related to the performance of the post–buyout firm. These issues are examined for a sample of 238 PE–backed buyouts in the UK between 1993 and 2003. Implications for theory and practice are suggested.
ISSN:1042-2587
1540-6520
DOI:10.1111/j.1540-6520.2008.00287.x