PRAISE FOR Private Equity
The Robert W. Kolb Series in Finance is an unparalleled source of information dedicated to the most important issues in modern finance. Each book focuses on a specific topic in the field of finance and contains contributed chapters from both respected academics and experienced financial professionals. As part of the Robert W. Kolb Series in Finance, Private Equity aims to be the essential guide to this important subject.
Like everything else in the world of finance, private equity has had to weather the economic crisis that recently unfolded. But as things begin to turn around, the private equity sector will pick up quickly. That′s why it′s important to understand everything this asset class has to offer.
Divided into four comprehensive parts, Private Equity skillfully covers the most essential elements of this discipline and will put you in a better position to benefit from recent trends in this industry. Written by some of today′s leading practitioners and academics in this field, it:
Covers the structure of private equity funds and fundraising
Focuses on the structure of private equity investments with their investee firms
Addresses both the financial and real returns to private equity
Provides analyses of international differences in private equity markets, many of which are attributable to legal and regulatory factors
With each contributor bringing their own unique experiences to the private equity process, this book distills the knowledge, skills, and abilities you need to succeed in today′s dynamic financial environment.
About the Editor.
PART I The Structure of Private Equity Funds and Fund–Raising.
2 Institutional Investment in Private Equity:Motivations, Strategies, and Performance.
Institutional Investment: Motivations and Behavior.
Structure and Strategies.
3 IPOs and Other Nontraditional Fund–Raising Methods of Private Equity Firms.
Recent Trends in the Private Equity Industry.
Traditional Fund–Raising Methods.
Nontraditional Fund–Raising Methods.
Private Equity IPOs: Performance and Implications for the Future.
Sovereign Wealth Funds Complementing and Substituting for Private Equity Investments.
4 Listed Private Equity.
Listed Private Equity: Definitions and Categorization.
Terms and Definitions.
Further Empirical Insights on Listed Private Equity.
5 The Syndication of Private Equity.
Motives for Syndication.
Structuring and Managing the Syndicate.
Syndication and Performance.
The Future of Syndication Research.
6 The Structure of Venture Capital and Private Equity Fund Portfolios.
Why the Structure of Venture Capitalists′ Portfolios Matters.
Optimal Effort Levels.
Optimal Portfolio Size and Profit–Sharing Rule.
7 The Rise of the PIPEMarket.
What Is a PIPE?
Contract Terms in PIPE Offerings.
Firms Issuing PIPEs.
Investors in the PIPE Market.
The Role of Placement Agents.
Issues in the PIPE Market and SEC Regulations.
The PIPE Market Down the Road.
8 Private Placements by Small Public Entities: Canadian Experience.
The Canadian Context.
Private Placements and the Issuers.
Returns Surrounding Private Placements.
9 Hedge Funds′ Activism: A New Trend of Convergence toward Private Equity in Public Firms?
Hedge Funds and Private Equity: Market Data and Trends toward Convergence.
Hedge Funds Approach to Activism.
Features of Targeted Companies.
How Hedge Funds Engage a Fight against Incumbent Management.
Clinical Study of Carl Icahn versus Time Warner, Inc.
PART III Financial and Real Returns to Private Equity.
10 Projection of Private Equity Fund Performance: A Simulation Approach.
A Simulation Approach for Venture Capital Performance Projection and Risk Management.
Simulation Results for Two Fictitious Venture Capital Funds.
11 Value Creation in Middle–Market Buyouts: A Transaction–Level Analysis.
Background, Context, and Prior Literature.
12 Risk and Return of Private Equity: An Overview of Data, Methods, and Results.
13 Private Equity Fund Selection: How to Find True Top–Quartile Performers.
The Research Approach.
Measurement and Operationalization.
Which Factors Correlate with Future Performance?
Random Choice versus the Crystal Ball: An Approach to Measuring PE Fund Selection Efficiency.
The Peracs Private Equity Selection Efficiency Measure.
The Selection Efficiency of Performance–Based Fund Selection Rules.
Shortcomings of the Traditional Benchmarking Approach.
Using and Interpreting the Right Public Market Benchmarks.
Advanced Private Equity Benchmarking Based on Deal–Level Benchmarks.
Quantitative Due Diligence Case Study: Advanced Private Equity Benchmarking.
The Fund Selection Efficiency of Advanced Private Equity Benchmarking Techniques.
14 Real Effects of Private Equity: Empirical Evidence and a Research Agenda.
Evidence of the Real Effects of Private Equity.
15 Employment,Wage, and Productivity Effects of Private Equity Transactions.
The Universe of Private Equity Transactions.
Task of the Chapter.
Employment and Productivity Identities.
Employment, Wage, and Productivity Effects.
PART IV International Perspectives on Private Equity and Regulation.
16 Valuation and (Financial) Disclosure in the Private Equity Industry: Institutional Set–Up, Incentives, and Empirical Analysis.
Main Problems and Conflicts of Interest.
Incentives for Voluntary Disclosure versus Mandatory Disclosure.
Disclosure and Reporting Patterns of Venture–Backed Portfolio Firms.
17 Private Equity Regulation: A Comparative Analysis.
The Growth of Private Equity.
Dealing with Agency Problems: Contractual Arrangements.
Regulation of Private Equity Funds.
18 International Private Equity Flows.
A Brief Overview of International Fund–Raising.
International Investments of Private Equity Funds in Western Europe, North America, and Australia.
Private Equity in Emerging Markets.
Conclusion and Avenues for Research.
19 Private Equity in Emerging Markets.
What Determines Emerging Market PE Activity?
Survey among Institutional Investors on the Importance of Emerging Markets Allocation Criteria.
20 Private Equity in Europe.
The Structure of Private Equity Funds.
Private Equity Investment.
Internationalization of Private Equity.
Private Equity Performance.
21 Private Equity and Leveraged Buyouts in Italy: To Prohibit or Not to Prohibit, That Is the Question.
The Buyout Market and Its Puzzling Trend.
The LBO Scheme and Related Criticisms.
The LBO Legal Environment: Past, Present, and Future Trends.
The Economic Impact of the 2004 Reform.
22 Venture Capital and Private Equity in Germany.
The Development of the German Venture Capital Industry.
Going Public as an Exit Route for Venture Capital and the Performance of Venture–Backed IPOs in Germany.
23 Private Equity in Denmark: Capital Structure and Taxes.
Consequences for Capital Structure of Portfolio Companies.
Implications for Tax Payments.
24 Venture Capital and Private Equity in Canada: Phasing Out an Inefficient Tax Credit.
Description of 2008 YORKbiotech Survey Data.
Multivariate Regression Evidence.