The Global Economic Impact of Private Equity Report 2008 - World ...

TablesTable 3: Change in the board composition of LBOs onlyThis table shows the change in the board composition whenthe firm is taken private. Only LBOs are considered. Wemeasure the board composition of the last board before thecompany is taken private (before) and of the second boardobserved after the company is taken private (after). Wedistinguish between cases where the CEO changes afterthe buyout and cases where the CEO does not change.T‐statistics of the difference between these two cases andof the difference between the board before and after areprovided. Panel A reports the number of outside directorssitting on the board (as a percentage of total directors), PanelB reports the number of insiders (CEO, management andother insiders) and Panel C reports the number of LBOsponsors (partners or employees of private equity firmsbacking the LBO).Panel A: Percentage of outsiders sitting on the board(m) (l) (m) - (l)No CEO CEOchange change t-statn=40 n=45(b) Before 42% 44% -0.56(a) After 9% 10% -0.36(b) - (a) t-stat 11.04 11.53(m) (l) (m) - (l)No CEO CEOChange Change t-statChange inpercentageafter event 34% 35% -0.24Panel B: Percentage of insiders sitting on the board(m) (l) (m) - (l)No CEO CEOchange change t-statn=40 n=45(b) Before 57% 55% 0.64(a) After 61% 47% 2.87(b) - (a) t-stat ‐1.01 1.80(m) (l) (m) - (l)No CEO CEOchange change t-statChange inpercentage after event - ‐4% 8% ‐2.28Table 4: Differences between exited and non‐exiteddeals (LBOs only)Panel A: Change in the board size by exit(m) (l) (m) - (l)No exit Exit t-statn=46 n=41(b) Before 6.61 6.39 0.60(a) After 5.52 5.32 0.46(b) - (a) t-stat 2.86 2.50(m) (l) (m) - (l)Change in size No exit Exit t-statafter event 1.09 1.07 0.03Panel B: Percentage of insiders sitting on the board(m) (l) (m) - (l)No exit Exit t-statn=46 n=41(b) Before 55% 55% -0.17(a) After 49% 58% -1.54(b) - (a) t-stat 1.27 -0.47Change in percentage(m) (l) (m) - (l)No exit Exit t-statafter event 5% ‐2% 1.44Panel C: Percentage of LBO sponsors sitting on the board(m) (l) (m) - (l)No exit Exit t-statn=46 n=41(b) Before ‐ ‐ ‐(a) After 35% 26% 1.75(b) - (a) t-stat ‐ ‐Panel D: Percentage of CEO changes(m) (l) (m) - (l)No exit Exit t-statn=46 n=39CEO change 61% 44% 1.59Panel C: Percentage of LBO sponsors sitting on the board(m) (l) (m) - (l)No CEO CEOchange change t-statn=40 n=45(b) Before ‐ ‐ ‐(a) After 25% 37% -2.35(b) - (a) t-stat ‐ ‐80 Large-sample studies: Corporate governanceThe Global Economic Impact of Private Equity Report 2008