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Innovation and R&D investments by leveraged buyout companies in times of crisis

Abstract : We study innovation and R&D investments made from 2008 to 2010 by UK companies that were the targets of leveraged buyout (LBO) in previous years. We find that overall, LBO companies do not exhibit lower innovation and R&D investments than non-LBO companies during the crisis, with other things being equal. However, innovation and R&D investments decline substantially in LBO companies that were financially constrained before the deal. We argue that in unfavorable market conditions, LBOs tend to exacerbate the issues related to investments in innovation in firms facing financial constraints.
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https://halshs.archives-ouvertes.fr/halshs-01006395
Contributor : Naïla Louise-Rose Connect in order to contact the contributor
Submitted on : Monday, June 16, 2014 - 8:38:36 AM
Last modification on : Thursday, March 31, 2022 - 5:58:01 PM

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  • HAL Id : halshs-01006395, version 1

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Fabio Bertoni, Anne-Laure Le Nadant, Frédéric Perdreau. Innovation and R&D investments by leveraged buyout companies in times of crisis. Economics Bulletin, Economics Bulletin, 2014, 34 (2), pp.856-864. ⟨halshs-01006395⟩

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