European Management Buyouts 1999-2003

Comparing the value creation of European management buyouts to those done in North America the following seven hypotheses are tested and concluded -- H1: The depreciation paid will decrease in pre-buyout years for firms undergoing and MBO; H2: The total assets of MBO firms will decrease in post-buyout years; H3: The debt of the MBO firm will increase significantly post-buyout; H4: Management buyout firms will observe a yearly decrease in post-buyout FCF; H5: A firm undergoing an MBO will have lower tax payments post-buyout; H6: Employee levels will decrease in MBO firms post-buyout; H7: Firm size measured by revenue for buyout companies will increase marginally post-buyout.