Private equity acquisitions and product market decisions: Evidence from trademarks

Abstract The paper examines the impact of public‐to‐private Leveraged Buyouts (LBOs) on product market decisions using trademark data from 201 public LBOs and 3,628 non‐LBO firms. Findings show no significant change in trademark filings for product innovations post‐LBO but a notable 24%‐44% reduction in filings for existing products (marketing activities), reflecting strategic streamlining rather than random cost‐cutting. LBO firms retain focus on marketing activities classes, with increased concentration in related product clusters, emphasizing a targeted marketing strategy. Contrary to concerns about leveraged constraints stifling innovation, results indicate that managerial alignment and PE advisory roles maintain long‐term value creation without altering risk appetites.