Luc is creating new understanding of private equity buyouts

Connecting the dots between legal theory and business

“My research focuses on the common ground between various contractual documents for private equity-backed buyouts,” he says. “I start with legal documentation. But I’m also carrying out research that’s typically for business administration, analysing real-life agreements and drawing on theories such as agency theory, incomplete contracting theory, and so on.

“Essentially, I’m analysing the typical contractual pattern for private equity-backed buyouts. What is included in a shareholder agreement? What are typical clauses? Or what clauses don’t you see very often? What are common characteristics of certain types of clause? For instance, clauses that give control to management – or veto rights to certain parties. There is a lot to analyse.”

Research to help practitioners like him

Luc is building a unique collection of descriptive data – such as how many types of clauses are in these contracts, how many times they occur, what the typical percentages of equity owned by management are – and so on. He’s also analysing this data and coming to conclusions about what an ideal contract should include for different buyout situations.

He says: “My research certainly furthers my personal learning – and I can draw on this in my day job. But at a broader level, I want to give back to my profession – to create a toolbox of clauses that can or should be used for private equity investments.”

Digging deep into the data

The clue is in the name – private equity firms can be reserved about openly sharing their business information. So to source the data he needs, Luc has to dig deep.

“The data I’m using isn’t available in a database,” he says. “I’m collecting it myself, by hand. This involves sourcing real-life contracts and agreements, analysing them – and then coding the agreements based on a list of variables.

“The parameters of my research are that they are all Belgium-based buyouts where the private equity firm is the majority investor. I have data from around 250 transactions over a 17 to 18-year period. There aren’t thousands of these types of buyouts a year – there are maybe 30 or 40. So my sample is certainly representative.

“Of course, part of the data comes from my own office. We do a lot of buyouts – so if I was to exclude that information, I would miss some interesting transactions happening in Belgium. But I also collect data from contracts produced by other firms. This is publicly available via the Courts of Commerce clerk’s office and the National Bank of Belgium database. Alternatively, I find it by looking at the articles of association of buyout companies. So it's publicly available data, but you cannot find it on the internet. You really have to dig for it.”

Sharing his insights with peers

Luc has already published several papers. This includes a peer-reviewed article – which he describes as a rigorous process.

“The peer review process is very iterative,” he says. “Usually two or three people review the paper – mostly academics who are very familiar with private equity. It’s a very small world. But you have some excellent authors and editors that give you detailed feedback. They offer advice, ask questions and work with you to try to make your paper better.

“You learn a lot, because you get asked good questions or you get information you didn't have. And sometimes you get insight that makes you think, why didn't I consider that? Or suggestions for future research. Because the data I’ve collected is extensive – it can be used for several papers.

“I’ve always said, I don’t want to write 20 papers. I would rather focus my efforts on three or four high quality papers, that are useful for practitioners, academics, or private equity funds.”

Support along the journey

After the first couple of years of the doctoral programme, Luc says you are largely left to carry out your research. But this doesn’t mean you’re on your own.

He says: “My supervisors are Vlerick professors Sophie Manigart, from Vlerick and Gent University, and Veroniek Collewaert, from Vlerick and KU Leuven – and they’re really involved and very responsive. They’re my backbone on the programme. Then there are the facilities, the library, the support staff who are always there to help.

“And of course you have your cohort. There are points where everyone is brought together – like the acceleration week on campus or seminar sessions where you can present your research and hear from others. These are valuable opportunities for cross-learning, asking questions and interacting with fellow doctoral students.”

On the home stretch

Luc is coming to the end of his doctoral journey. His final piece of work is his thesis – which he hopes to defend at the end of this year. But he won’t stop there.

“I will certainly continue to research,” he says. “I’m professionally active – and my research helps me to stay up-to-date with recent buyouts and trends.  Also, I spend every day working on transactions and writing agreements. Carrying out research, writing papers and presenting – it’s a moment of reflection for me.

“Private equity is a fast-moving beast. It’s quite important today. And I’m convinced that in the future it will become more important. And I want to be part of that evolution.”

Learn more about private equity-backed buyouts

Dive into Luc’s published academic papers >

Dive into the publications of Luc's supervisors, Professor Sophie Manigart and Professor Veroniek Collewaert.