Beyond Borders in Private Equity A quantitative study unveiling the drivers of return in cross-border buy-and-build strategies
(2024) IBUH19 20241Department of Business Administration
- Abstract
- The aim of this thesis is to determine what drives the return in cross-border buy-and-build (B&B) strategies, and if the drivers and the return generated in cross-border B&B strategies differ from those in domestic strategies. Drawing upon prior research of B&B strategies and cross-border M&A, the thesis provides an overview of the current studies on value drivers in private equity, and B&B strategies, with an additional focus on implications of cross-border M&As. To test the hypotheses, a quantitative study with a deductive approach was employed. Variables were constructed using secondary data from Orbis M&A, together with supplementary data from additional sources. The conducted analysis indicates that cross-border B&Bs generate higher... (More)
- The aim of this thesis is to determine what drives the return in cross-border buy-and-build (B&B) strategies, and if the drivers and the return generated in cross-border B&B strategies differ from those in domestic strategies. Drawing upon prior research of B&B strategies and cross-border M&A, the thesis provides an overview of the current studies on value drivers in private equity, and B&B strategies, with an additional focus on implications of cross-border M&As. To test the hypotheses, a quantitative study with a deductive approach was employed. Variables were constructed using secondary data from Orbis M&A, together with supplementary data from additional sources. The conducted analysis indicates that cross-border B&Bs generate higher returns than their domestic counterparts. Cross-border B&B results in greater multiple expansion, which could be attributed to the associated complexity premium. For operating improvements, no notable differences were found between domestic and cross-border B&Bs. However, operating improvements were found to be the primary drivers of return in cross-border B&Bs, indicating the importance of synergistic effects between add-ons. By replicating this thesis using proprietary data, the generalisability of these findings could be increased, thus contributing to a deeper understanding of cross-border B&B strategies. (Less)
- Popular Abstract
- The aim of this thesis is to determine what drives the return in cross-border buy-and-build (B&B) strategies, and if the drivers and the return generated in cross-border B&B strategies differ from those in domestic strategies. Drawing upon prior research of B&B strategies and cross-border M&A, the thesis provides an overview of the current studies on value drivers in private equity, and B&B strategies, with an additional focus on implications of cross-border M&As. To test the hypotheses, a quantitative study with a deductive approach was employed. Variables were constructed using secondary data from Orbis M&A, together with supplementary data from additional sources. The conducted analysis indicates that cross-border B&Bs generate higher... (More)
- The aim of this thesis is to determine what drives the return in cross-border buy-and-build (B&B) strategies, and if the drivers and the return generated in cross-border B&B strategies differ from those in domestic strategies. Drawing upon prior research of B&B strategies and cross-border M&A, the thesis provides an overview of the current studies on value drivers in private equity, and B&B strategies, with an additional focus on implications of cross-border M&As. To test the hypotheses, a quantitative study with a deductive approach was employed. Variables were constructed using secondary data from Orbis M&A, together with supplementary data from additional sources. The conducted analysis indicates that cross-border B&Bs generate higher returns than their domestic counterparts. Cross-border B&B results in greater multiple expansion, which could be attributed to the associated complexity premium. For operating improvements, no notable differences were found between domestic and cross-border B&Bs. However, operating improvements were found to be the primary drivers of return in cross-border B&Bs, indicating the importance of synergistic effects between add-ons. By replicating this thesis using proprietary data, the generalisability of these findings could be increased, thus contributing to a deeper understanding of cross-border B&B strategies. (Less)
Please use this url to cite or link to this publication:
http://lup.lub.lu.se/student-papers/record/9160264
- author
- Nordén, Anton LU ; Nordström, Bror LU and Borg, Elias LU
- supervisor
- organization
- course
- IBUH19 20241
- year
- 2024
- type
- M2 - Bachelor Degree
- subject
- keywords
- private equity, buy-and-build, cross-border, multiple expansion, operating improvements, value creation
- language
- English
- id
- 9160264
- date added to LUP
- 2024-08-07 17:48:21
- date last changed
- 2024-08-07 17:48:21
@misc{9160264, abstract = {{The aim of this thesis is to determine what drives the return in cross-border buy-and-build (B&B) strategies, and if the drivers and the return generated in cross-border B&B strategies differ from those in domestic strategies. Drawing upon prior research of B&B strategies and cross-border M&A, the thesis provides an overview of the current studies on value drivers in private equity, and B&B strategies, with an additional focus on implications of cross-border M&As. To test the hypotheses, a quantitative study with a deductive approach was employed. Variables were constructed using secondary data from Orbis M&A, together with supplementary data from additional sources. The conducted analysis indicates that cross-border B&Bs generate higher returns than their domestic counterparts. Cross-border B&B results in greater multiple expansion, which could be attributed to the associated complexity premium. For operating improvements, no notable differences were found between domestic and cross-border B&Bs. However, operating improvements were found to be the primary drivers of return in cross-border B&Bs, indicating the importance of synergistic effects between add-ons. By replicating this thesis using proprietary data, the generalisability of these findings could be increased, thus contributing to a deeper understanding of cross-border B&B strategies.}}, author = {{Nordén, Anton and Nordström, Bror and Borg, Elias}}, language = {{eng}}, note = {{Student Paper}}, title = {{Beyond Borders in Private Equity A quantitative study unveiling the drivers of return in cross-border buy-and-build strategies}}, year = {{2024}}, }