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Post-Offering Operating Performance of Reverse LBOs: An Update

Post-Offering Operating Performance of Reverse LBOs: An Update

Sevilay Gümüş
Copyright: © 2015 |Pages: 28
ISBN13: 9781466674844|ISBN10: 1466674849|EISBN13: 9781466674851
DOI: 10.4018/978-1-4666-7484-4.ch022
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MLA

Gümüş, Sevilay. "Post-Offering Operating Performance of Reverse LBOs: An Update." Handbook of Research on Behavioral Finance and Investment Strategies: Decision Making in the Financial Industry, edited by Zeynep Copur, IGI Global, 2015, pp. 350-377. https://doi.org/10.4018/978-1-4666-7484-4.ch022

APA

Gümüş, S. (2015). Post-Offering Operating Performance of Reverse LBOs: An Update. In Z. Copur (Ed.), Handbook of Research on Behavioral Finance and Investment Strategies: Decision Making in the Financial Industry (pp. 350-377). IGI Global. https://doi.org/10.4018/978-1-4666-7484-4.ch022

Chicago

Gümüş, Sevilay. "Post-Offering Operating Performance of Reverse LBOs: An Update." In Handbook of Research on Behavioral Finance and Investment Strategies: Decision Making in the Financial Industry, edited by Zeynep Copur, 350-377. Hershey, PA: IGI Global, 2015. https://doi.org/10.4018/978-1-4666-7484-4.ch022

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Abstract

This chapter reports on the post-offering performance of 114 US firms that went public between 2000 and 2008 following leverage buyouts. The objective of this paper is to examine accounting performance of following reverse leverage buyouts compared to the industry competitors before, at the time of, and the following four years after initial public offering. In addition to accounting performance measures, capital expenditures, working capital and employment levels are also compared to rival firms. The evidence indicates that the RLBO corporations have superior accounting performances compared to their industries exact year of IPO and following years after public offering. Also, the RLBO corporations have less operating income compared to the reverse leverage buyout firms in previous studies, but have more operating income and operating cash flows than their industry counterparts. The RLBO firms typically make less capital expenditure except the IPO year and four years after the initial public offering.

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