Financial Profile of Leveraged Buyout Targets: Some French Evidence

Anne-Laure Le Nadant (1) , Frédéric Perdreau (1, 2)

1 CREM - Centre de recherche en économie et management
2 COACTIS - COnception de l'ACTIon en Situation

This paper investigates whether firms, which are taken over on the French market through Leveraged Buyouts (LBOs), possess characteristics prior to the change which differentiate them from firms which are not acquired through LBOs. Contrasting 175 LBO targets on the French market with an industry-matched comparison group, we first run univariate analysis and then multivariate analysis (logit regression). Beyond the underscoring of the LBO targets' financial features, we conclude that subdividing our sample according to the vendor and bidder type is beneficial. We thus notice that the so-called outperformance of LBO targets prior to the deal hides in fact different cases.

Mots clés: LBO; motives; financial characteristics; performance

Domaines: Gestion et management; Economies et finances

Anne-Laure Le Nadant, Frédéric Perdreau. Financial Profile of Leveraged Buyout Targets: Some French Evidence. Review of Accounting and Finance, 2006, 5 (4), pp.370-392. ⟨halshs-00522624⟩