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- W1516294953 abstract "A popular view is that private equity (PE) firms tend to expropriate other stakeholders of their portfolio companies. Bonds offered during 1992-2011 by companies after their initial public offerings (IPOs) do not reflect this view. We find that yield spreads on bonds offered by PE-backed companies are on average 70 basis points lower, holding other things constant. We also find that PE-backed companies have more conservative investment and dividend policies after bond offerings compared to non-PE-backed companies. These results suggest that PE firms’ reputational concerns dominate their wealth expropriation incentives and help their portfolio companies reduce the costs of debt." @default.
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- W1516294953 date "2013-01-01" @default.
- W1516294953 modified "2023-09-23" @default.
- W1516294953 title "Private Equity Firms’ Reputational Concerns and the Costs of Debt Financing" @default.
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- W1516294953 doi "https://doi.org/10.2139/ssrn.2205720" @default.
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