The Bright and Dark Side of Staging : Investment performance and the varying motivations of private equity firms
Journal
Journal of Banking and Finance
ISSN
0378-4266
ISSN-Digital
1872-6372
Type
journal article
Date Issued
2009-09-09
Author(s)
Krohmer, Philipp
;
Lauterbach, Rainer
;
Calanog, Victor
Abstract
Previous papers that examined investment decisions by private equity funds are divided on whether staging has a positive or negative effect on returns. We believe these opposing views can be reconciled by studying when staging is used during the life of the investment relationship: We find that staging has a positive effect on investment returns in the beginning of the investment relationship, consistent with the notion that staging helps mitigate information asymmetry. However, staging appears to be negatively associated with returns when used prior to the exit decision. Our unique dataset allows us to measure these intertemporal effects precisely.
Language
English
HSG Classification
contribution to scientific community
Refereed
Yes
Publisher
Elsevier
Publisher place
Amsterdam [u.a.]
Volume
33
Number
9
Start page
1597
End page
1609
Pages
13
Subject(s)
Division(s)
Eprints ID
72364