Using Japanese IPOs, this paper empirically examines the roles that bank-affiliated venture capital firms play in mitigating information asymmetries that are detrimental in small business lending. We find that concurrent bank lending and investing via venture capital subsidiaries benefits firms...

This paper provides a comprehensive study of deal characteristics and participants’ involvement in leveraged buyouts (LBOs) and their impact on target firms’ performance. Using a sample of 501 U.S. LBOs completed between 1986 and 2011, I find that better post-buyout operating performance are...

This paper studies whether debt renegotiation mitigates debt overhang and improves investment efficiency. Using mergers between lenders participated in the same syndicated loans as natural experiments that exogenously reduce the number of lenders and thus make renegotiation easier, I find that...

We employ a dynamic adjustment model (Flannery and Rangan, 2006) to investigate the determinants of capital structure and speed of adjustment (Drobetz and Wanzenried, 2006) in a panel of 85 U.S. ICT firms over the years 1990 to 2013. We estimate the capital structure using a wide range of...

We use a proprietary dataset to explore (i) the financial covenant structure and (ii) the determinants of their restrictiveness in leveraged buyouts. With respect to (i) we find that the covenant structure is more standardized in sponsored than in non-sponsored loans: the former show less...

Agency theory predicts that leverage affects agency costs and thereby the firm's influence will be influenced. The goal of the paper is to examine the profitability-capital relationship for the US banks using an unbalanced panel over the period 1995-2007. In our model we used a combination of...

This paper investigates the relationship between leverage and the financial performance of listed firm in Kenya. We use annual data for the period 2002-2011. Using various panel procedures, our study finds reasonably strong evidence that leverage significantly, and negatively, affects the...

We exploit variation in the timing of bank mergers and acquisitions (M&As) and adopt a difference- in-differences approach to examine how bank consolidation affects financial policies of corporate borrowers. We find that firms increase leverage ratios after their lending banks are involved in...

In this paper we challenge the view that corporate bonds are always arm's length debt. We analyze the effect of bond ratings on the stock price return to acquirers in M&A transactions, which tend to have significant effects on creditor wealth. We find acquirers abnormal returns to be higher if...

We apply control rights theory to explain the structure and determinants of financial covenants in private equity backed leveraged buyouts. We analyze 130 German transactions from 2000 to 2008, covering about 40 percent of the LBO market during this period. We consider Germany to be a superior...