The probability of a subsequent IPO after taken private through LBO

• Main Authors: Hsing-Yu Lee, 李星諭
• Other Authors: Shean-Bii Chiu
• Format: Others
• Language: en_US
• Published: 2018
• Online Access: http://ndltd.ncl.edu.tw/handle/gve99t

碩士 === 國立臺灣大學 === 財務金融學研究所 === 106 === Several papers study on the topic of whether Leveraged Buyouts (LBOs) would create value. Guo, Hotchkiss and Song (2011) shows that within all possible outcomes of an LBO, a subsequent IPO seems to have the highest returns. They further investigate the relative importance of the three potential contributors of returns. Their study indicates that improvements in operating performance measured by accounting items play an important role in generating returns. In this paper, I collect data for companies announced to go private through LBO between January 1990 and June 2014. Logit regression is applied for modeling the probability, the results suggest that the estimated probability of a subsequent IPO, on average, is much higher than the simple estimator, calculated as dividing number of companies with a subsequent IPO in the sample by sample size. Overall, I believe the results indicate that the model specification in this paper is reliable.