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Agency, Strategic Entrepreneurship, and the Performance of Private Equity-Backed Buyouts
Article first published online: 29 DEC 2008
DOI: 10.1111/j.1540-6520.2008.00287.x
© 2009 Baylor University
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How to Cite
Meuleman, M., Amess, K., Wright, M. and Scholes, L. (2009), Agency, Strategic Entrepreneurship, and the Performance of Private Equity-Backed Buyouts. Entrepreneurship Theory and Practice, 33: 213–239. doi: 10.1111/j.1540-6520.2008.00287.x
Publication History
- Issue published online: 29 DEC 2008
- Article first published online: 29 DEC 2008
- Abstract
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Agency theory has focused on buyouts as a governance and control device to increase profitability, organizational efficiency, and limited attention to growth. A strategic entrepreneurship view of buyouts incorporates upside incentives for value creation associated with growth as well as efficiency gains. In this paper, we develop the complementarity between agency theory and strategic entrepreneurship perspectives to examine the performance implications for different types of buyouts. Further, we study how the involvement of private equity (PE) firms is related to the performance of the post-buyout firm. These issues are examined for a sample of 238 PE-backed buyouts in the UK between 1993 and 2003. Implications for theory and practice are suggested.