Since the emergence of leveraged buyouts as a new form of organization with enhanced incentives and monitoring, researchers have questioned how sustainable any performance improvement is and whether any increase in value purely is a wealth transfer to the disadvantage of other parties involved. Post-exit performance depends on the new management structure of the former buyout. The motives and efforts of parties involved - managers, employees, and owners – depends on their share of benefits related to the company and the individual utility function. The interesting question, therefore, was whether changes at the exit are a return to the pre-LBO structure or the birth of a significantly different governance structure allowing post-LBO superior performance. The author has investigated the changes in governance, strategy, operations and performance after the exit from a leveraged buyout structure based on three case studies in Germany. This concluding chapter summarizes the insights that can be drawn from the preceding analysis.
KeywordsCorporate Governance Cash Flow Institutional Investor Capital Structure Agency Cost
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