Economic Impact of Private Equity in Germany: How buy-out investments influence the German economy – an empirical analysis.p

In a buy-out, a company’s managers give up their salaried positions and become entrepreneurs. The change means more risk and increased motivation for the management team, says Deutsche Beteiligungs AG. With the help of a financial sponsor who can improve the operation’s financial situation and contribute know-how in the areas of structured financing and internal organizational improvements, the team can create momentum that will fuel increased growth. That is the theory, anyway. But how do private-equity companies perform in the long run?