Year-end Sale % OFF 
Abstract
Single family offices (SFOs) manage trillions of dollars worldwide. The enormous value of assets under management highlights their key role as a cohesive wealth management tool globally. Despite the increasing relevance of SFOs, research on SFOs is still in its early stages. Particularly little is known about the capital structure of the firms owned by SFOs. By drawing on a hand-collected sample of 173 SFO-owned firms in the DACH (Germany, Austria, Switzerland) region, we compare the capital structure of SFO-owned firms with the capital structure of family-owned firms. Our empirical results show that SFO-owned firms display a higher long-term debt ratio than family-owned firms, indicating that SFO-owned firms follow trade-off theory, similar to private equity-owned firms. Additionally, we show that this effect is stronger for SFOs that sold their original family firm. In contrast, family-owned firms tend to be more conservative in their financial decision-making and seem to follow the logic of the pecking order theory.
Published Version
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
