Stealing from Thy Neighbour: Leveraged Recapitalizations and Wealth Redistribution

Details

Serval ID
serval:BIB_73343F17B47D
Type
Article: article from journal or magazin.
Collection
Publications
Title
Stealing from Thy Neighbour: Leveraged Recapitalizations and Wealth Redistribution
Journal
British Journal of Management
Author(s)
Markides  C., Oyon  D.
ISSN
1045-3172
Publication state
Published
Issued date
06/1994
Peer-reviewed
Oui
Volume
5
Number
2
Pages
135-152
Language
english
Abstract
Leverage-increasing transactions such as recapitalizations and leveraged buy-outs are known to create shareholder wealth. It has been argued that the only sources of this value are efficiency improvements and tax benefits brought about by the higher debt load. This paper shows empirically that contrary to popular belief a portion of this wealth comes at the expense of current bondholders. It is estimated that between 20 per cent and SO per cent of the value created during a leveraged recapitalization can be attributed to wealth transfers from bondholders to shareholders.
Create date
26/05/2010 22:33
Last modification date
20/08/2019 14:31
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