Date of Award

Spring 6-9-2026

Document Type

Thesis (Undergraduate)

Department

Economics

First Advisor

Bruce Sacerdote

Abstract

This paper considers which publicly traded firms are most likely to exit public markets through acquisition, and how those patterns differ between financial sponsors and strategic acquirers. Using a panel of 3,320 U.S. public firms from 2000 to 2024, I estimate discrete-time hazard models and find that lower valuation multiples, higher leverage, and stronger free cash flow predict going private. These characteristics vary for financial sponsors and strategic acquirers who select on different criteria. Strategic selection is driven mainly by leverage and valuation while private equity is also driven by free cash flow. These criteria are not stable over time, but track roughly with the interest-rate cycle. Private equity take-private risk rises as the federal funds rate falls, and cheap leverage becomes abundant. A model trained on data through 2020 predicts the delisting of companies out of the sample, achieving an area under the ROC curve of 0.73 and ranking targets in its top risk decile at 3.12 times the base rate.

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