Due Diligence and Investee Performance

Cumming, Douglas ; Zambelli, Simona (2015) Due Diligence and Investee Performance.
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Abstract

Our study provides new evidence on due diligence (DD) and its impact on investee performance. We estimate the economic value of due diligence (DD) in the context of private equity (PE) by investigating the relationship between DD and investee performance, while controlling for endogeneity. With the adoption of a novel and unique dataset, we find evidence highly consistent with the view that a thorough DD is associated with improved future investee performance. We also distinguish the role of different types of DD and show that the DD carried out internally by fund managers has a more pronounced impact on performance. Instead, the DD mainly performed by external agents, such as consultants, lawyers and accountants, gives rise to puzzling results and imperfect matching, highlighting the existence of apparent agency problems.

Abstract
Tipologia del documento
Articolo
Autori
AutoreAffiliazioneORCID
Cumming, Douglas
Zambelli, Simona
Settori scientifico-disciplinari
DOI
Data di deposito
08 Gen 2016 16:55
Ultima modifica
08 Gen 2016 16:55
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