Publication Type

Journal Article

Version

acceptedVersion

Publication Date

3-2020

Abstract

This paper examines the impact of investor protection laws on value creation in LBOs versus non-LBO takeovers. We find that value creation measured by takeover premium is significantly higher in countries with better investor protection. The value effect of investor protection laws is more pronounced for LBOs than non-LBO takeover transactions. Among LBOs, investor protection’s value effect is lower for club deals than others. These results suggest that institutional context and legal environment determine the extent of value creation for takeovers around the world.

Keywords

Leveraged buyouts, Legal environment, Law, Premium, Shareholder rights, Club deals, Value effect, Investor protection

Discipline

Corporate Finance | Finance and Financial Management

Research Areas

Finance

Publication

Journal of International Financial Markets, Institutions and Money

Volume

59

First Page

1

Last Page

18

Identifier

10.1016/j.intfin.2018.11.012

Publisher

Elsevier

Embargo Period

4-14-2021

Copyright Owner and License

Authors

Additional URL

https://doi.org/10.1016/j.intfin.2018.11.012

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