Cross-border private equity syndication: Institutional context and learning

Private equity (PE) has become an increasingly international phenomenon but there is a lack of research that looks at the process by which PE firms invest across borders. We aim to fill this gap in the literature by examining the role of institutional context and organizational learning as determina...

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Bibliographic Details
Published in:Journal of business venturing 2011, Vol.26 (1), p.35-48
Main Authors: Meuleman, Miguel, Wright, Mike
Format: Article
Language:English
Subjects:
Business administration
Cross border transactions
Economics and Finance
Humanities and Social Sciences
Institutional theory
International finance
Internationalization
Organization theory
Organizational learning
Private equity
Private equity Institutional theory Organizational learning Internationalization
Studies
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Summary:Private equity (PE) has become an increasingly international phenomenon but there is a lack of research that looks at the process by which PE firms invest across borders. We aim to fill this gap in the literature by examining the role of institutional context and organizational learning as determinants of cross-border PE syndication. We examine these issues by studying the international expansion by later-stage UK PE investors into continental Europe over the period 1990 to 2006. Our results indicate that institutional context (in terms of the number of PE firms in the local environment and the presence of investment bankers in the local market) and organizational learning (in terms of the PE firm's experience in the host country; the PE firm's multinational experience; and the number of investment managers per portfolio company; but not the presence of local offices) are significantly related to the use of cross-border syndicates. Implications for theory and practice are suggested.
ISSN:0883-9026
1873-2003
DOI:10.1016/j.jbusvent.2009.06.003