Managerial Incentives and Value Creation: Evidence from Private Equity∗
نویسندگان
چکیده
We analyze the differences between companies owned by private equity (PE) investors and similar public companies. We document that PE-owned companies provide higher managerial incentives to their top management: CEOs have almost twice as much equity, 10% lower salary, and more cash compensation than their counterparts at comparable public corporations. We also find some evidence that PE ownership is related to improvements in operational efficiency and profitability. However, any differences between PE-owned companies and public companies disappear over a very short period (one to two years) after the PE-owned firm goes public.
منابع مشابه
Study of information content Equity Market Value in predicting Shareholder Value Added and Created Shareholder Value Evidence from Tehran Stock Exchange
The aim of this paper is to investigate the relationship between Equity Market Value (EMV) and measures of creation value of the performance evaluation (Shareholder Value Added (SVA) and Created Shareholder Value (CSV)) in Tehran Stock Exchange. Thus this paper examined the creation value in Iranian Companies by Alfred Rappaport model and to assess the relationship, liner regression tests w...
متن کاملInterregional Patient Mobility in the Italian NHS: A Case of Badly-Managed Decentralization; Comment on “Regional Incentives and Patient Cross-Border Mobility: Evidence From the Italian Experience”
The article by Brenna and Spandonaro on interregional mobility for acute hospital care in Italy raises important issues concerning social and territorial equity in a healthcare system. Based on Regions and private providers’ strategic behavior, the hypothesis adopted to explain patient cross-border mobility (CBM), demonstrated by statistical analysis, may be further explored using qualitative m...
متن کاملRegional Incentives and Patient Cross-Border Mobility: Evidence from the Italian Experience
Background In recent years, accreditation of private hospitals followed by decentralisation of the Italian National Health Service (NHS) into 21 regional health systems has provided a good empirical ground for investigating the Tiebout principle of “voting with their feet”. We examine the infra-regional trade-off between greater patient choice (due to an increase in hospital services supply) an...
متن کاملUse of Equity Market Value for explaining Cash Flow Return on Investment (CFROI) and Created Shareholder Value (CSV) Evidence from Automotive Industry Tehran Stock Exchange
The concept of Value Creation is gaining momentum in Iran under the open regime. Iranian Companies are geared to understand and act upon the concept of Shareholder Value to stay competitive in this unfathomable and volatile environment. Most executives today understand that, the need to create shareholder value is paramount and the world’s most competitive management teams are responding to the...
متن کاملJuly 2009 Occasional paper 24 Do Private Equity Owned Firms Have Better Management Practices ?
We use an innovative survey tool to collect management practice data from over 4,000 medium sized manufacturing firms across Asia, Europe and the US. These measures of managerial practice are strongly associated with firm-level performance (e.g. productivity, profitability and stock market value). Private Equityowned firms are significantly better managed than government, family and privately o...
متن کامل