Critical analysis of private equity investments in SME PDF Download

Author: Timo Zimenga
Publisher: GRIN Verlag
ISBN: 3346242382
Category : Business & Economics
Languages : en
Pages : 37

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Book Description
Seminar paper from the year 2019 in the subject Business economics - Investment and Finance, grade: 2,0, University of applied sciences, Düsseldorf, course: International Investment & Controlling, language: English, abstract: Is it worth the time and work involved in taking various risks and sometimes the path into the unknown? This question arises in the context with private equity financing. However, this is also a question which arises in companies when it comes to identifying a source of finance. No matter for what reason the company needs a financial injection, either for internal development, new production machinery or for a breakthrough into new markets. In order to find out more about private equity, the assignments objective for the module “International Investment & Controlling” addresses the topic: “Critical analysis of private equity investments in SME” For this purpose, this assignment will start with a short introduction on the relevance of the topic, followed by the fundamentals and theoretical basis of private equity as well as about SME’s. Furthermore, the actual problematic situation which belongs to private equity investments is presented. After these introducing topics the paper switches to its main part, the critical analysis about - Investment done by GP / LP and a return increase; - Leveraged buyouts; - Risks characteristics; - Rules, regulations & contractual infrastructure. Finally, a conclusion as well as a critical outlook are provided. This conclusion contains that both, investors and companies, want to have a clearer view about risks and contractual requirements and restrictions.

Author:
Publisher: GRIN Verlag
ISBN: 3346123928
Category : Business & Economics
Languages : en
Pages : 26

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Book Description
Seminar paper from the year 2018 in the subject Business economics - Investment and Finance, grade: 1,3, University of applied sciences, Düsseldorf, language: English, abstract: This work focuses on the private equity (PE) investments within SMEs. Fundamentals of private equity investments are reviewed in the second chapter. This includes definition and product categories of private equity and how PE business is organized as well as the history of PE market in Germany. The third chapter analyses the process of the PE deals including the different phases as well as the exit strategies. The last chapter critically analyse the PE deals from the point of view of the investor and the targeted company before closing with the outlook and conclusion. In the last decades, the private equity market in Germany has witnessed waves of rise and fall. But it surpassed, by the end of 2017, all the records of German PE history. According to Deutsche Beteiligungs (DBAG), the amount of transactions in the mid-sized businesses in the German market dramatically increased and hit €4.4 billion in 2017 which was the highest during the last 15 years. But in contrast, the competition in the German market has been recently high with a steady number of companies which led to high prices and overvalued companies. PE firms target the mid-sized businesses since they are more likely to accept financial investors than bank loans or credit lines. However, this problem can now be countered with the help of PE in the context of alternative corporate financing. It should be noted that PE business has been a concern of German politics and businesses since the 1960s where the financial system was basically based on banks which is not appropriate for the development of PE industry. The government intervention was the base to build a stronger PE industry away from bank-based financial systems. Recently, the stock market segment was a key driver for the dynamic development of PE market. The price falls and the collapse of the overheated and overvalued companies were also clearly felt in the PE segment and generated a great deal over scepticism on the capital markets.

Author: Anonym
Publisher:
ISBN: 9783346123930
Category :
Languages : en
Pages : 28

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Book Description
Seminar paper from the year 2018 in the subject Business economics - Investment and Finance, grade: 1,3, University of applied sciences, Düsseldorf, language: English, abstract: This work focuses on the private equity (PE) investments within SMEs. Fundamentals of private equity investments are reviewed in the second chapter. This includes definition and product categories of private equity and how PE business is organized as well as the history of PE market in Germany. The third chapter analyses the process of the PE deals including the different phases as well as the exit strategies. The last chapter critically analyse the PE deals from the point of view of the investor and the targeted company before closing with the outlook and conclusion. In the last decades, the private equity market in Germany has witnessed waves of rise and fall. But it surpassed, by the end of 2017, all the records of German PE history. According to Deutsche Beteiligungs (DBAG), the amount of transactions in the mid-sized businesses in the German market dramatically increased and hit 4.4 billion in 2017 which was the highest during the last 15 years. But in contrast, the competition in the German market has been recently high with a steady number of companies which led to high prices and overvalued companies. PE firms target the mid-sized businesses since they are more likely to accept financial investors than bank loans or credit lines. However, this problem can now be countered with the help of PE in the context of alternative corporate financing. It should be noted that PE business has been a concern of German politics and businesses since the 1960s where the financial system was basically based on banks which is not appropriate for the development of PE industry. The government intervention was the base to build a stronger PE industry away from bank-based financial systems. Recently, the stock market segment was a key driver for the dynamic development of PE market. The price fall

Author: Christin Wessels
Publisher: GRIN Verlag
ISBN: 3668443394
Category : Business & Economics
Languages : en
Pages : 34

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Book Description
Seminar paper from the year 2017 in the subject Business economics - Investment and Finance, grade: 1,7, University of applied sciences Dortmund, course: Investment, language: English, abstract: Company successions are an important theme for the economy. The amount of enterprises, which search for a successor, increased in the last years. Especially small and medium-sized enterprises are affected by this issue. In this case the issue arises, that no internal successor is available. That’s why external opportunities have to be considered. Among options like foundations or management buy-outs, private equity investors are one possibility of a successor. These investors bring new equity and know how into the enterprise. On the other side, private equity firms often invest only for a defined period and focus on the return on investments. That’s why private equity firms mention in the sales contract specific rights and agreements. These rights include e.g., that other shareholder have to sell their shares, if the private equity firm wants to sell its shares. Furthermore, if the private equity firm wants to go public, the other shareholders must agree. If these rights are reflected in the sales contract, the private equity firm has the total power over the enterprise. That’s why especially in the contract phase the current entrepreneur should be alerted, what agreements are reflected in the contract. Otherwise the PE firm holds sway over the whole company. After the defined time horizon, the private equity firm leaves the enterprise. For this different exit strategies exist: An Initial public offering, a trade sale, a secondary sale or a buy back. The most interesting one for the investor is to go public, followed by a trade sale. Going public means a high return on investments for the investor. All in all, the entrepreneur holds the strings: He can influence the future of the company, because he chooses the successor for the enterprise. If he reflects, what the enterprise needs and gets the motivation of the investor, why he wants to buy the enterprise, he can choose the right successor for his company.

Author:
Publisher: GRIN Verlag
ISBN: 3346672379
Category : Business & Economics
Languages : en
Pages : 27

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Book Description
Seminar paper from the year 2021 in the subject Business economics - Investment and Finance, grade: 1,3, University of Applied Sciences Essen, course: International Investment, language: English, abstract: This term paper is split into five chapters. After the introduction, the theoretical framework of small- and medium-sized enterprises (SMEs) and private equity (PE) is elaborated. Besides the explanatory definition of PE, an overview of PE types and the roles in PE investments is provided. Chapter three emphasizes the process of PE investments and their characteristics from the planning stage to exit strategies. Before the conclusion, opportunities and threats for SMEs and investors in PE investments are derived in section four.

Author: Richard S. Ruback
Publisher: Harvard Business Review Press
ISBN: 1633692515
Category : Business & Economics
Languages : en
Pages : 220

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Book Description
An all-in-one guide to helping you buy and own your own business. Are you looking for an alternative to a career path at a big firm? Does founding your own start-up seem too risky? There is a radical third path open to you: You can buy a small business and run it as CEO. Purchasing a small company offers significant financial rewards—as well as personal and professional fulfillment. Leading a firm means you can be your own boss, put your executive skills to work, fashion a company environment that meets your own needs, and profit directly from your success. But finding the right business to buy and closing the deal isn't always easy. In the HBR Guide to Buying a Small Business, Harvard Business School professors Richard Ruback and Royce Yudkoff help you: Determine if this path is right for you Raise capital for your acquisition Find and evaluate the right prospects Avoid the pitfalls that could derail your search Understand why a "dull" business might be the best investment Negotiate a potential deal with the seller Avoid deals that fall through at the last minute Arm yourself with the advice you need to succeed on the job, with the most trusted brand in business. Packed with how-to essentials from leading experts, the HBR Guides provide smart answers to your most pressing work challenges.

Author: Karis McGill
Publisher: RTI Press
ISBN:
Category : Business & Economics
Languages : en
Pages : 20

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Book Description
This study analyzes the return on investment for an agribusiness facilitation fund implemented in Rwanda. Combining project monitoring data with supplementary surveys and interviews of recipient agribusinesses, we find a positive return on investment in terms of farmer income generated per dollar spent by the US government. To determine the commercial viability of the investments, we estimate the payback period and find the median time it will take a firm to recoup the entire investment through profits is 3.7 years. We estimate the net present value of the entire fund portfolio to be $12.5 million. These estimates rely on conservative assumptions and likely underrepresent the profitability of the investments. Given the positive returns and commercial viability of the agribusinesses, we examine the fund’s role as a first step to “graduate” firms toward investment readiness. Although three firms did access equity investment, we find that the majority of the businesses in the portfolio do not meet investor requirements for deal size and management capacity and are more appropriately financed by commercial lenders. We conclude with recommendations for the implementation and measurement of similar funds.

Author: Ben White
Publisher: Routledge
ISBN: 1317976843
Category : Science
Languages : en
Pages : 615

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Book Description
This collection explores the complex dynamics of corporate land deals from a broad agrarian political economy perspective, with a special focus on the implications for property and labour regimes, labour processes and structures of accumulation. This involves looking at ways in which existing patterns of rural social differentiation – in terms of class, gender, ethnicity and generation – are being shaped by changes in land use and property relations, as well as by the re-organization of production and exchange as rural communities and resources are incorporated into global commodity chains. It goes further than the descriptive ‘what’ and ‘who’ questions, in order to understand the ‘how’ and ‘why’ of these patterns. It is empirically solid and theoretically sophisticated, making it a robust and boundary-changing work. Contributors come from various scholarly disciplines. Covering nearly all regions of the world, the collection will be of interest to researchers from various disciplines, policymakers and activists. This book was originally published as a Special Issue of the Journal of Peasant Studies.

Author: Eli Talmor
Publisher: John Wiley & Sons
ISBN: 1119973880
Category : Business & Economics
Languages : en
Pages : 801

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Book Description
Bringing a unique joint practitioner and academic perspective to the topic, this is the only available text on private equity truly international in focus. Examples are drawn from Europe the Middle East, Africa and America with major case studies from a wide range of business sectors, from the prestigious collection of the London Business School’s Coller Institute of Private Equity. Much more than a simple case book, however, International Private Equity provides a valuable overview of the private equity industry and uses the studies to exemplify all stages of the deal process, and to illustrate such key topics as investing in emerging markets; each chapter guides the reader with an authoritative narrative on the topic treated. Covering all the main aspects of the private equity model, the book includes treatment of fund raising, fund structuring, fund performance measurement, private equity valuation, due diligence, modeling of leveraged buyout transactions, and harvesting of private equity investments.

Author: OECD
Publisher: OECD Publishing
ISBN: 9264811192
Category :
Languages : en
Pages : 254

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Book Description
Financing SMEs and Entrepreneurs 2024: An OECD Scoreboard monitors SME and entrepreneurship financing trends, conditions and policy developments in close to 50 countries.