What is the impact of Private Equity Funds on LBO value creation?

The purpose of this thesis is to study the role of Private Equity and LBOs in the creation of value within the medical technology sector. In order to have a more practical picture, this thesis studies the drivers that contributed to the value creation in KCI's buyout by the consortium of investors formed by Apax Partners, CPPIB and PSP Investments. The research paper is divided into two distinct parts. On the one hand, the first part presents an overview of the Private Equity industry and the evolution and rationale of LBOs. This same section includes the conflicts of interest between the different LBO participants and concludes with the main metrics and drivers of value creation that are subsequently used in the case study. On the other hand, the second part consists of a case study of the KCI leverage buyout between the entry in 2011 and the exit in 2019 with the strategic sale to 3M Health Care. The section starts with an introduction to the medical technology sector and the company itself and continues with the rationale and risks associated with the deal. Finally, the analysis concludes with the calculation of the returns for all stakeholders and the breakdown of the value created among the different drivers following a methodology based on empirical studies published by different academics and studied in the first sectio