Wards Finance Seminar Series. The Role of Leverage in the Persistence of Buyout Performance
Published: 1 December 2025
14 January Wards Finance Seminar Series with Professor Axel Buchner. ESCP Business School (Berlin Campus)
Professor Axel Buchner, ESCP Business School (Berlin Campus)
"The Role of Leverage in the Persistence of Buyout Performance"
Wednesday 14 January 2026. 15:00-16:30 Room 282 The Adam Smith Business School Building
Abstract
The returns of successive buyout deals involving the same general partner (GP) are correlated. We attribute this performance persistence to private-equity sponsors’ leverage choices and the leverage effect generated by GPs leveraging buyouts and then reducing leverage until exit. The leverage effect accounts for 20% of buyout returns, and the persistence in the leverage effect accounts for all the return persistence. We observe higher persistence among inexperienced GPs and in more recent years, which suggests that persistence in returns and in the leverage effect does not equate to persistent outperformance.
Bio
Axel Buchner is a full Professor of Finance at ESCP Business School (Berlin Campus) where he holds the Chair in Entrepreneurial Finance and Corporate Finance.
At ESCP, Axel Buchner teaches courses on Financial Management, Corporate Finance, and (Advanced) Entrepreneurial Finance. He conducts research in the areas of entrepreneurial finance, venture capital and private equity. He focuses on understanding the risks, returns, and illiquidity inherent in venture capital, private equity, and other alternative investments. He has published his research in leading academic journals, including, among others, Management Science, Journal of International Business Studies (JIBS), Journal of Business Venturing, Journal of Banking and Finance, and Journal of Corporate Finance.
Before joining ESCP, he was Associate Professor of Finance at the University of Passau, where he also completed his Habilitation (post-doctoral university degree with lecture qualification). He has also been a visiting lecturer of finance at EDHEC Business School. He holds a PhD in Finance from the Technical University of Munich (TUM) and a Master’s in Business Administration from Ludwig Maximilian University of Munich (LMU).
For further information, please contact business-school-research@glasgow.ac.uk
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First published: 1 December 2025