A study on Shareholders value added of select Indian LBO companies

Abstract

This study examines impact of leveraged buyout on the shareholders value added of the select Indian companies. For this purpose seven sample leveraged buyout companies have been taken into consideration during the study period 2005-06 to 2009-10. Mean and coefficient of variation of SVA of the sample companies have been computed before and after three years period of leveraged buyout in order to measure the change in performance related to shareholders value added. Event study approach has been adopted to measure the change in performance of the sample companies. Finally, it is found that there is improvement in shareholders’ value after leveraged buyout since Paired t test has depicted a statistically significant result.