The Operational Consequences of Private Equity Buyouts: Evidence from the Restaurant Industry

• 成果类型: Article
• 署名作者: Bernstein, Shai; Sheen, Albert
• 署名单位: Stanford University; National Bureau of Economic Research; University of Oregon
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhw037
• 发表日期: 2016
• 页码: 2387
• 关键词: management buyouts; empirical-analysis; product quality; performance; FIRMS; form; INFORMATION; incentives; leverage

摘要

How do private equity firms affect their portfolio companies? We document operational changes in restaurant chain buyouts using comprehensive health inspection records. Store-level operational practices improve after private equity buyout, as restaurants become cleaner, safer, and better maintained. Supporting a causal interpretation, this effect is stronger in chain-owned stores than in franchised locations-twin restaurants over which private equity owners have limited control. These changes are particularly apparent when private equity partners have prior industry experience. The results suggest that by bringing in industry expertise, private equity firms improve firm operations.