New paper provides latest research in private equity and company acquisitions
Written by Yichen Fang, Communications Intern
Dr. Josephine Gemson, Associate Professor of the School of Management, Economics, and Mathematics (MEM), has published a journal paper titled “Private company acquisitions in the market for corporate control: A comparison between private equity and corporate acquirers” in The Quarterly Review of Economics and Finance.
The article is set in the mergers and acquisitions market and examines private company acquisitions in the light of the market for corporate control. Financial acquirers (private equity) are compared with strategic acquirers (corporate firms) to analyze acquirer choice, target characteristics, and deal characteristics, and its impact on deal value.
Dr. Gemson chose to study private target acquisitions because private companies are generally difficult to value, compared to their public counterparts.
“It was very interesting to see how financial buyers, such as private equity, are pitted against strategic buyers, such as corporate firms, during the acquisition process in their ultimate goal of value addition – which they go about through different means. Private equity is a very exciting field in finance and there is much to be learned,” says Dr. Gemson.
“I think this paper will provide valuable insights for academics and practitioners looking to get up to speed on the latest research in private equity / private company acquisitions. It also opens out new avenues for research and conversations”, says Dr. Gemson.
Dr. Gemson has been researching the subject since she worked on her Ph.D., but it was the summer of 2018 when she began to develop the theory behind the paper.
She is grateful for the support from many within the King’s community, including Laura Whidden, Associate Librarian and Head of Technical Information Resources at the Cardinal Carter Library and Dan Gingert from Private Company Financial Database (PrivCo) who helped secure the necessary data.
After receiving a King’s Research Grant , Dr. Gemson was able to bring on two “amazing” summer associates, Mark Creighton and Sriram Radhakrishnan, both fourth-year Economics students at that time who assisted in data collection.
Dr. Gemson also sought out feedback and comments from colleagues in the School of MEM including Dr. Trevor Hunter, Dr. Grigori Erenburg, and Dr. Lori Murray.
After presenting the paper a preliminary form of the paper at the 31st Australasian Finance and Banking Conference in Sydney, Australia to positive reviews, the paper was published.