Research reports

2009

Study on equity finance in small and medium enterprises

With the recent financial crisis, the importance of equity finance has received increased attention by both businesses and the general public. A joint study by the Center for Entrepreneurial and Financial Studies, Ernst & Young and Deutsche Börse investigates the reasons for this trend towards a higher level of equity finance. The authors also analyze the relevance of public offerings of equity to a company's development and to the national economy.
[pdf]

2008

Primary Market Activity and the Cost of Going and Being Public

This is the second follow-on study of a paper presented by the same authors under the title 'Deutsche Börse: Going Public and Being Public. The Impact of the Listing Decision on the Cost of Capital - An International Comparison' in November 2006, at the German Equity Forum in Frankfurt. The first follow-on study was presented in November 2007 at the German Equity Forum in Frankfurt under the title 'Going Public and Being Public - A Global Comparison of the Impact of the Listing Decision on the Cost of Capital'.
[pdf]

Private Equity in Familienunternehmen - Erfahrungen mit Minderheitsbeteiligungen (Private Equity in Family Firms - Experiences with Minority Shareholdings)

Ann-Kristin Achleitner, Stephanie Schraml and Florian Tappeiner finalized the study on private equity minority investements in family firms. This study was conducted on behalf of Stiftung Familienunternehmen. It analyzes the suitability of minority investments by private-equity-investors for family firms. The results are based on qualitative analysis of in-depth interviews with family firms, private-equity-investors and experts. The paper covers the motivation and the process of the share sale, the legal structuring of contracts, and the impact of the private-equity-investors on the family firms. The results reflect a strong satisfaction of the family firms with the minority investments. Apart from the capital injection, the family firms benefit from the investors' support in corporate governance, controlling and reporting as well as corporate finance. A crucial prerequisite for a successful partnership is the diligent selection of the investor, as their investment approach can differ to a large extent. Additionally, the legal structuring of the relevant contracts is decisive. The shareholders' agreement and the articles of association shall eliminate potential conflicts between the family firm and the private-equity-investor. Regulations concerning the investors' influence and exit are of high importance.
[SSRN]

2007

European Venture Capital Market: Scaling Beyond Current Boundaries

The study was undertaken by the Private Equity Institute of London Business School in cooperation with CEFS on behalf of the European Private Equity and Venture Capital Association (EVCA) and can be purchased on the EVCA webpage.

Going Public and Being Public - A Global Comparison of the Impact of the Listing Decision on the Cost of Capital

This is a follow-on study of a paper by Prof. Kaserer and Prof. Schiereck (ebs) under the title 'Deutsche Börse: Going Public and Being Public. The Impact of the Listing Decision on the Cost of Capital - An International Comparison'. It has been presented at Deutsches Eigenkapitalforum in Frankfurt on November 12, 2007.


Expertise "Erwerb und Übernahme von Firmen durch Finanzinvestoren (insbesondere Private-Equity-Gesellschaften)" for the German ministry of finance

From August 2006 until April 2007 a project team from CEFS was working on behalf of the Federal Ministry of Finance (Bundesministerium der Finanzen) on an expertise about the situation of private equity in Germany (title: Forschungsauftrag fe 3/06: Erwerb und Übernahme von Firmen durch Finanzinvestoren). Besides the two scientific directors from CEFS, Prof. Dr. Dr. Ann-Kristin Achleitner and Prof. Dr. Christoph Kaserer (project leader), two cooperation partners were responsible for the project: Prof. Dr. Dirk Schiereck from the european business school (ebs) and Dr. Christoph von Einem, L.L.M. from the international law firm White & Case. Further members of the project team that was involved in writing the expertise are: Markus Ampenberger, Marko Bender, Annabell Geidner, Henry Lahr, Dr. Eva Nathusius (CEFS), Mark Mietzner (ebs), Dr. Ines Buermeyer (White & Case). It was the goal of the expertise to provide well-grounded recommendations for the German legislator to prepare a new private-equity law. The recommendations were built on a series of economic and legal analysis (e.g. about the role of Venture Capital and Private Equity, the market situation in Germany and Europe, value drivers and effects of private equity transactions, legal and tax situation in Europe and USA).
Summary [pdf]    Link to amazon


2006

Deutsche Börse: Going Public and Being Public

In a joint project with the European Business School, the CEFS looks more closely at the capital costs of going and being-public at Deutsche Börse in Frankfurt, Germany versus the London Stock Exchange (LSE). First findings show that for German listed firms the role of the stock market as an equity financing channel is at least as important as for listed companies in other presumably more equity oriented countries. Furthermore, the IPOs at Deutsche Börse profit from attractive flotation costs. These are on average at 11.7% in London, while in Frankfurt they are only at 8.7%. Generally, the impact of the costs of being a public company on the cost of capital is at a higher range at LSE than at Deutsche Börse regardless of the initial free float of the company. And a sub-sample analysis shows that Frankfurt has lower implicit trading costs compared to London.



2005

Employment contribution of Private Equity and Venture Capital in Europe

This study has been undertaken for the European Venture Capital and Private Equity Association (EVCA) by the CEFS. It is the first pan-European survey on the overall employment contribution of the private equity and venture capital industry to European job creation. It examines both the current levels of employment by private equity and venture capital financed companies as well as the new jobs created by the industry in recent years.

You have to register to access the project documentation. The registration form and the documentation can be found here:
Project documentation

Family Firms and Private Equity:- Identifying Psychological Barriers

This study was conducted in jointly with APAX Partners. It analyses the relationship between family firms and private equity investors, whereat special attention is paid to eventual biases and prejudices. In this study possible methods of resolution are described. The following link leads to the respective APAX insight offprint.
APAX insight offprint [german]


2004

The Role of Private Equity in Strategic Asset Allocation

We are proud to announce that the European Private Equity and Venture Capital Association (EVCA) published the joint study of  CDC IXIS and the Center for Entrepreneurial and  Financial Studies (CEFS) on the role of Private Equity in strategic asset allocation. For more information on the study  please follow the link below to access the press release.
 [english]
[german]

The study is available since March 2004 free of charge at the EVCA website.
[EVCA publication area]