Hubert Ooghe

• PhD Business Economics
• Professor Emeritus at Vlerick Business School, Gent, Belgium / Ghent University, Faculty of Economics and Business, Gent, Belgium

This paper analyses the duration of the time to exit of distressed firms, differentiating between court driven exits (mainly bankruptcies) and voluntary liquidations. It examines how long firms survive after initial signs of economic distress. The study is conducted on an extensive dataset of 5,233 Belgian distress-related exits of mature firms, th...

This paper examines firm-level determinants of mature firm exits after economic distress. Using nested logit models and a sample of 6,118 distress-related exits in Belgium, we analyze the type of exit that distressed firms experience. We show that 41% of the firms in our sample exit through a court driven exit procedure (mainly bankruptcy), 44% are...

This note briefly describes three performance measures that can be used in business failure prediction models: the unweighted error rate (UER), D-max and the Gini-coefficient. The use of these measures (and the mathematical relationship between them) is illustrated with numerical examples. We hope that this note may help the reader to better unders...

This paper gives an overview of the shortcomings of the most frequently used statistical techniques in failure prediction modeling. The statistical procedures that underpin the selection of variables and the determination of coefficients often lead to 'overfitting'. It is also seen that the 'expected signs' of variables are sometimes neglected and...

This paper gives an overview of the shortcomings of the most frequently used statistical techniques in failure prediction modeling. The statistical procedures that underpin the selection of variables and the determination of coefficients often lead to 'overfitting'. It is also seen that the 'expected signs' of variables are sometimes neglected and...

This paper provides new insights on the determinants of firm exit after distress. Using nested logit models and a sample of 6118 distress-related exits from Belgium, we analyze the impacts of available and potential slack and the relative efficiency of voluntary liquidation, compared to acquisition and merger, on the type of exit. It appears essent...

We examine the determinants of the debt-equity choice and the debt maturity choice for a sample of small, privately held firms in a creditor oriented environment. Our results, which are based on 4,706 firm-year observations for 1132 Belgian firms in the period 1996–2000, generally confirm the role of asymmetric information and agency costs of debt...

We examine the determinants of the debt-equity choice and the debt maturity choice for a sample of small, privately held firms in a creditor oriented environment. Our results, which are based on 4,706 firm-year observations for 1132 Belgian firms in the period 1996–2000, generally confirm the role of asymmetric information and agency costs of debt...

Faced with the question as to whether failure prediction models can easily be transferred and applied to a new data setting, this study examines the performance of seven models on a dataset of Belgian company failures after re-estimation of the coefficients. The validation results indicate that some models are widely usable: they are strongly predi...

Few studies have addressed the pre-takeover financial characteristics of multiple versus single acquirers and their targets. Therefore this study investigates whether multiple acquirers, with some experience in acquiring companies, might acquire firms with different (better) financial characteristics than single acquirers. Results confirm this hypo...

This note briefly describes some important performance measures that can be used in failure prediction research. We do not only give an overview of the measures, but also clarify the connections between them and illustrate their use with numerical examples.

Purpose - The purpose of this paper is to show that previous research about financial and non-financial causes of bankruptcy has neglected the time dimension of failure. The paper seeks to gain deeper insight into the failure process of a company, giving it a more grounded understanding of the relationship between the characteristics of a company,...

Over the last 35 years, business failure prediction has become a major research domain within corporate finance. Numerous corporate failure prediction models have been developed, based on various modelling techniques. The most popular are the classic cross-sectional statistical methods, which have resulted in various ‘single-period’ or static model...

Few studies have addressed the pre-take-over financial characteristics of multiple versus single acquirers and their targets. Therefore this study investigates whether multiple acquirers, with some experience in acquiring companies, might acquire firms with different (better) financial characteristics than single acquirers. Results confirm this hyp...

Few studies have addressed the performance of smaller unquoted companies involved in acquisitions, especially in Continental European countries. Therefore this study addresses the post-acquisition financial characteristics of privately held companies involved in 143 Belgian acquisitions between 1992 and 1994. Specifically, this paper examines the f...

We give an overview of the shortcomings of the most frequently used statistical techniques in failure prediction modelling. The statistical procedures that underpin the selection of variables and the determination of coefficients often lead to ‘overfitting’. We also see that the ‘expected signs’ of variables are sometimes neglected and that an unde...

Deze studie heeft als primaire doel de evolutie van de financiële gezondheid van de Belgische ondernemingen over een periode van 10 jaar in kaart te brengen. Het is de voortzetting van de jaarlijkse uitgave “De financiële toestand van de Belgische ondernemingen” (laatste editie: Ooghe, Spaenjers en Vandermoere, 2005). De studie loopt over het tijds...

Op basis van de jaarrekening alleen is het moeilijk oorzaken van de problemen binnen een onderneming in moeilijkheden tijdig op te sporen. In deze bijdrage wordt een vragenlijst voorgesteld ter vaststelling van de oorzaken van de onderliggende problemen.

This paper analyses the duration of the time to exit of distressed firms, differentiating between court driven exits (mainly bankruptcies) and voluntary liquidations. It examines how long firms survive after initial signs of economic distress. The study is conducted on an extensive dataset of 5,233 Belgian distress-related exits of mature firms, th...

Inleiding Sinds het einde van de jaren '60 is falingspredictie een van de belangrijkste onderzoeksdomeinen binnen de corporate finance. Bijna veertig jaar geleden legden Beaver (1967) en Altman (1968) met enkele papers inzake het gebruik van financiële ratio's de basis van een vernieuwde interesse in deze ietwat bijzondere tak binnen de bedrijfseco...

This study addresses the pre-acquisition financial characteristics of privately held, rather small acquiring and acquired companies involved in 143 Belgian take-overs between 1992 and 1994. Specifically, the research examines the profitability, liquidity, financial structure, added value and failure risk using statistical analysis of industryadjust...

Nick Waeyaert 2 19 september 2005 FACULTEIT ECONOMIE EN BEDRIJFSKUNDE * Deze studie is uitgevoerd in het kader van het Steunpunt voor beleidsrelevant onderzoek in verband met ondernemingen, ondernemerschap en innovatie van de Vlaamse overheid.

This study addresses lhe pre-acquisition financial characteristics of privately held, rather small acquiring and acquired companies involved in 143 Belgian takeovers between 1992 and 1994. Specifically, the research examines the profitability, liquidity, financial structure, added value and failure risk using statistical analysi.s of industry-adjus...

Over the last 35 years, the topic of business failure prediction has developed to a major research domain in corporate finance. A gigantic number of academic researchers from all over the world have been developing corporate failure prediction models, based on various modelling techniques. The ‘classical cross-sectional statistical’ methods have ap...

Over the last 35 years, the topic of company failure prediction has developed to a major research domain in corporate finance. Academic researchers from all over the world have been developing a gigantic number of corporate failure prediction models, based on various types of modelling techniques. Besides the classical cross-sectional statistical m...

Door het samenbrengen van een aantal financiële kerngegevens in verband met bruto toegevoegde waarde, rendabiliteit, liquiditeit en solvabiliteit, is het mogelijk een financieel portret te schetsen van een onderneming. Als dit op een consistente manier wordt uitgevoerd, bijvoorbeeld aan de hand van een positioneringsroos, is het mogelijk de financi...

Once a firm decides to issue debt, the characteristics of this debt instrument should be considered. One of the critical decisions involves debt maturity. Using a sample of 1091 Belgian small firms from 1996 until 2000, this study analyses the determinants of the corporate debt-maturity structure of small firms in a creditor-oriented s ystem. Consi...

Jaarlijks worden er ongeveer 7000 Belgische ondernemingen, waaronder een kleine 4000 Vlaamse, failliet verklaard. Dat is gemiddeld iets meer dan 19 Belgische of net geen 11 Vlaamse ondernemingen per dag. Het begrip ‘faling’ is in de huidige economische context dan ook zeer actueel en verdient zeker de nodige aandacht. De belangstelling voor het fen...

This study compares the predictive performances of the Ooghe-Joos-De Vos models across different industries and subgroups concerning size-class and annual accounts form. Type I, type II and unweighted error rates, Gini-coefficients and trade-off functions are analysed. The results indicate a wide variety of performances for the different subgroups....

Compares two corporate governance models: the Anglo-American and the Continental European model. These corporate governance models differ strongly, and the differences are mainly due to differences in the business context. The problems arising from separation of ownership from control will thus have to be solved through different mechanisms. One im...

Few studies have addressed the performance of smaller unquoted companies involved in take-overs, especially in the Continental European countries. Therefore this study addresses the post-take-over financial characteristics of privately held companies involved in 143 Belgian take-overs between 1992 and 1994. Specifically, this paper examines the fin...

Faced with the question as to whether failure prediction models (multiple discriminant and logit analysis) from different countries can easily be transferred to other countries, this study examines the validity of a range of models on a dataset of Belgian company accounts, both when using the original and re-estimated coefficients. Firstly, contrar...

This study addresses the pre-acquisition financial characteristics of privately held acquiring and acquired companies involved in 143 Belgian takeovers between 1992 and 1994. Specifically, the research examines the profitability, liquidity, financial structure, added value and failure risk using statistical analysis of industry-adjusted variables....

This study tests the validity of the Belgian Ooghe-Joos-De Vos (1991) failure prediction models (1 and 3 years prior to failure) across 18 different industries and different size classes. Firstly, the performance results and the trade-off functions reveal a wide range of performances for the different industries. However, we notice that the OJD mod...

In this paper, two corporate governance models have been compared - the Anglo-Saxon and the Continental European models. These corporate governance models differ strongly, and the differences are mainly due to differences in the business context. The problems arising from separation of ownership from control will thus have to be solved through diff...

ABSTRACT

Corporate governance has for some time been a buzzword in the Anglo-Saxon business world, sharpening debate on what should be the optimal composition of a companys board of directors. For those countries where businesses do not follow the Anglo-Saxon model, however, there has until now been little investigation into whether the same ideas would be...

The influence of corporate governance issues on the performance of a company has been discussed for some time, but only empirical evidence can convince people of the importance of these issues for the future. Moreover, the issues until now have largely been placed in an Anglo-Saxon business context, and make no reference to other models, such as co...

The Economic and Business Consequences of the EMU A Challenge for Governments, Financial Institutions and Firms Hubert Ooghe Conference Chairman, Vlerick Leuven Gent Management School alld Ghent University EMU finally got under way on 1 st January 1999. Since then 11 European countries share a common currency, the Euro, and pursue a common monetary...

The objective of this study is to describe financial management practices in China by means of a qualitative, case study approach. A total of 16 firms in the Shanghai region were interviewed. The research results refer to: investment in fixed assets; financing methods and sources; dividend policy; working capital management; internationalization; a...

In this paper cross-sectional differences in the composition of the board of directors and the impact of board composition on corporate performance and dividend policy are examined empirically in a sample of 122 Belgian companies. We found evidence that both board size and the relative importance of outside directors are positively related to compa...

This paper tries, first, to document the returns response of stocks to unexpected semi-annual earnings after the announcement of these earnings in a small capital market, i.e. the Brussels Stock Exchange (hereafter BSE), and second, to assess the explanations and empirical problems found in the literature concerning the post-earnings announcement d...

Although the European venture capital industry has become nearly as important as its American counterpart, little research has been done to describe its nature and importance. This study gives in the first place an overview of the importance of the venture capital industry in the major European countries. Thereafter, we look for funding and investm...

This article analyzes the reasons for the development of venture capital as a new source of finance. Structural economic problems, which are confronting the traditional industrial countries nowadays, require technological innovation as an important means in competing with the new industrialized countries. Innovation, however, needs a suitable sourc...