The Longer-Term Effects of Management-Led Buy-Outs

There is now extensive evidence on short-term performance improvements in buy-outs, but little relating to the longer-term. This paper examines the relatively neglected area of the longevity and longer-term effects of smaller buy-outs. In terms of longevity, the evidence presented shows that the majority remain as independent buy-outs for at least eight years after the transaction, and that entrepreneurial actions concerning both restructuring and product innovation are important parts of entrepreneurs\u27 strategies over a ten year period or more. For the first time, the paper also provides an analysis of the financial performance and productivity of a large sample of buy-outs and non-buyouts. It shows that on a variety of financial ratios buy-outs significantly outperform a matched sample of non-buy-outs, especially from year 3 onwards. Analysis of post buyout efficiency of survivor buy-outs, using regression analysis to estimate augmented Cobb-Douglas production functions, shows that buy-outs are superior to matched nonbuy-outs with a productivity differential of the order of 9% on average from year t+2 onwards. The evidence of superior longer term performance suggests that venture capitalists may need to consider their investment perspectives carefully, particularly in respect of exit versus second round investment. For financiers it is clear that the buy-out concept can be successfully applied to growth as well as restructuring cases

The contribution of management buy-ins to corporate restructuring: concepts, characteristics and performance

From the mid-1980s many UK venture capitalists, as an extension to their involvement in management buy-outs, made investments in management buy-ins where they backed new managers to purchase equity stakes in an existing company. This Thesis analyses the corporate restructuring and entrepreneurial influences behind buy-ins taking note of turnaround and venture capital influences. It draws on general buy-in characteristics from a database of 750 management buy-ins and the results of a representative questionnaire survey of 59 management buy-ins (mailed in February 1990) and backed by individual case studies. It is hypothesised that management buy-ins are a distinctive corporate restructuring form and have major differences with management buy-outs. Buy-ins are shown to be significantly different from buy-outs in terms of source, activity and realisation; they are more likely to be bought from a private source and to end up in receivership. Financing structures are more conservative but not on a statistically significant basis. Buy-in teams are smaller than in buy-outs, frequently have initial skills gaps, and in a minority of cases are led by second time entrepreneurs. The target company is normally identified through informal networks. Buy-ins are followed by a significantly higher degree of action in financial, product and marketing areas than Buy-outs and other restructuring processes such as turnarounds. Compared to US LBOs more attention is paid to working asset management with little unbundling of fixed assets and higher capital expenditure. Team Leaders are shown to be mainly opportunist in terms of entrepreneurial typology with a minority craftsmen and, unexpectedly, a few mainly motivated by push factors. This is in contrast to buy-outs where a typology is developed showing a preponderance of craftsmen. Overall performance after buy-in was below original Business Plan but heavily influenced by adverse economic and financial conditions. Different types of Team Leaders were not associated with significant differences in performance although opportunists were more likely to be acquisitive. Contrary to the principles of corporate restructuring, discriminant analysis showed equity ratchets and higher rates of leverage being negative influences on profitability. Case studies showed ineffective monitoring and control by some venture capitalists. Buy-ins of privately owned companies where there are particular problems of information assymetery and those bought in the late 1980s where unrealistically high prices may have been paid for the target company were poor performers. Among entrepreneur related variables, the team's knowledge of each other was an important positive influence but education was negative

Superboom Caustic Analysis and Measurement Program (SCAMP) Final Report

The objectives of the Superboom Caustic Analysis and Measurement (SCAMP) Program were to develop and validate, via flight-test measurements, analytical models for sonic boom signatures in and around focal zones as they are expected to occur during commercial aircraft transition from subsonic to supersonic flight, and to apply these models to focus boom prediction of low-boom aircraft designs. The SCAMP program has successfully investigated sonic boom focusing both analytically and experimentally, while gathering a comprehensive empirical flight test and acoustic dataset, and developing a suite of focused sonic boom prediction tools. An experimental flight and acoustic measurement test was designed during the initial year of the SCAMP program, with execution of the SCAMP flight test occurring in May 2011. The current SCAMP team, led by Wyle, includes partners from the Boeing Company, Pennsylvania State University, Gulfstream Aerospace, Eagle Aeronautics, and Central Washington University. Numerous collaborators have also participated by supporting the experiment with human and equipment resources at their own expense. The experiment involved precision flight of a McDonnell Douglas (now Boeing) F-18B executing different maneuvers that created focused sonic booms. The maneuvers were designed to center on the flight regime expected for commercial supersonic aircraft transonic transition, and also span a range of caustic curvatures in order to provide a variety of conditions for code validations. The SCAMP experiment was designed to capture concurrent F-18B on-board flight instrumentation data, high-fidelity ground-based and airborne acoustic data, and surface and upper air meteorological data. Close coordination with NASA Dryden resulted in the development of new experimental instrumentation and techniques to facilitate the SCAMP flight-test execution, including the development of an F-18B Mach rate cockpit display, TG-14 powered glider in-flight sonic boom measurement instrumentation and "Where's the Focus?" (WTF) software for near-real time way-point computation accounting for local atmospherics. In May 2011, 13 F-18B flights were conducted during 5 flying days over a 2 week period. A densely populated 10,000 ft-long ground acoustic array with 125-ft microphone spacing was designed to capture pre-, focus, and post-focus regions. The ground-based acoustic array was placed in a nominally east-west orientation in the remote Cuddeback lakebed region, north of Edwards AFB. This area was carefully selected to avoid placing focused booms on populated areas or solar power facilities. For the SCAMP measurement campaign, approvals were obtained to temporarily extend the Black Mountain supersonic corridor northward by three miles. The SCAMP flight tests successfully captured 70 boom events, with 61 focus passes, and 9 calibration passes. Seventeen of the focus passes and three of the calibration passes were laterally offset; with the others being centerline flights. Airborne incoming sonic boom wave measurements were measured by the TG-14 for 10 of the F-18B flight passes including one maximum focus signature, several N-u combinations, several overlapped N-u signatures, and several evanescent waves. During the 27-month program, the SCAMP team developed a suite of integrated computer codes with sonic boom focusing predictive capabilities: PCBoom, Lossy Nonlinear Tricomi Equation Method (LNTE) and the Nonlinear Progressive wave Equation (NPE) method. PCBoom propagates the rays through the atmosphere and, in addition to legacy focus signature prediction based on the Gill-Seebass method, provides input source characteristics and propagation parameters to LNTE and NPE. LNTE, a Tricomi solver that incorporates atmospheric losses, computes the focus signature at the focus, and computes the focus signature in the vicinity of the focal zone, including the evanescent and post-focus zones. LNTE signature auralization from low-boom vehicle designs has been demonstrated in the NASA Langley Interior Effects Room (IER). The NPE has also been validated for use in prediction of focused ground boom signatures in sonic boom focal zones. The NPE formulation has the capability to incorporate atmospheric turbulence in the predictions. This has been applied to sonic boom propagation in the past. Prediction of turbulence effects on focal zone signatures was not, however, explored during the SCAMP program

Mortality and pulmonary complications in patients undergoing surgery with perioperative SARS-CoV-2 infection: an international cohort study

Background: The impact of severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2) on postoperative recovery needs to be understood to inform clinical decision making during and after the COVID-19 pandemic. This study reports 30-day mortality and pulmonary complication rates in patients with perioperative SARS-CoV-2 infection. Methods: This international, multicentre, cohort study at 235 hospitals in 24 countries included all patients undergoing surgery who had SARS-CoV-2 infection confirmed within 7 days before or 30 days after surgery. The primary outcome measure was 30-day postoperative mortality and was assessed in all enrolled patients. The main secondary outcome measure was pulmonary complications, defined as pneumonia, acute respiratory distress syndrome, or unexpected postoperative ventilation. Findings: This analysis includes 1128 patients who had surgery between Jan 1 and March 31, 2020, of whom 835 (74·0%) had emergency surgery and 280 (24·8%) had elective surgery. SARS-CoV-2 infection was confirmed preoperatively in 294 (26·1%) patients. 30-day mortality was 23·8% (268 of 1128). Pulmonary complications occurred in 577 (51·2%) of 1128 patients; 30-day mortality in these patients was 38·0% (219 of 577), accounting for 81·7% (219 of 268) of all deaths. In adjusted analyses, 30-day mortality was associated with male sex (odds ratio 1·75 [95% CI 1·28–2·40], p\textless0·0001), age 70 years or older versus younger than 70 years (2·30 [1·65–3·22], p\textless0·0001), American Society of Anesthesiologists grades 3–5 versus grades 1–2 (2·35 [1·57–3·53], p\textless0·0001), malignant versus benign or obstetric diagnosis (1·55 [1·01–2·39], p=0·046), emergency versus elective surgery (1·67 [1·06–2·63], p=0·026), and major versus minor surgery (1·52 [1·01–2·31], p=0·047). Interpretation: Postoperative pulmonary complications occur in half of patients with perioperative SARS-CoV-2 infection and are associated with high mortality. Thresholds for surgery during the COVID-19 pandemic should be higher than during normal practice, particularly in men aged 70 years and older. Consideration should be given for postponing non-urgent procedures and promoting non-operative treatment to delay or avoid the need for surgery. Funding: National Institute for Health Research (NIHR), Association of Coloproctology of Great Britain and Ireland, Bowel and Cancer Research, Bowel Disease Research Foundation, Association of Upper Gastrointestinal Surgeons, British Association of Surgical Oncology, British Gynaecological Cancer Society, European Society of Coloproctology, NIHR Academy, Sarcoma UK, Vascular Society for Great Britain and Ireland, and Yorkshire Cancer Research

The Development of an Organisational Innovation: Management Buy-Outs in the UK, 1980-97

This paper analyses the development of management buy-outs and similar transactions as an organisational innovation in the UK. Their development is situated in the context of the historical development of organisations which has previously emphasised shifts from family capitalism sto managerial capitalism and in the context of deregulation and its implications. The paper identifies five periods of development, pre-1980, 1980-84, 1985-89, 1990-94 and 1995 onwards, and shows how the prevalent forms of buy-out have changed and adapted across these periods. The paper analyses the economic impact of buy-out type organisations in terms of financial and ecomomic performance, impact on employment, and the longevity of buy-outs as on ownership form. Two particular continuing problem areas are identified: pricing of transactions and the role of debt.