Executive Takeaways
■ A large fraction of IPOs in the U. S. are sponsored by private equity firms. ■ PE firms’ reputational concerns
■ On average, PE-backed IPO companies have lower costs of debt than other IPO companies. ■ On average, PE-backed IPO companies pursue conservative investment and dividend policies.
alleviate their incentives to expropriate bondholders.
Rongbing Huang, Professor of Finance
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