Do zombie funds underperform other PE funds? : an empirical study of the Nordic private equity market
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- Master Thesis 
This thesis investigates the scope, magnitude and performance of zombie funds in the Nordic private equity market. Our sample comprises of a total 266 funds from the 5 different Nordic countries. The vintage years of our sample funds are from 1998 to 2007, in order to grasp the two major economic downturns since the turn of the millennia. We cross-examine our sample with funds that have a vintage between 2008 until today, in order to identify potential zombie funds. Given this analysis, we find that the zombie funds constitute a substantial proportion of the total Nordic PE market. We are also able to distinguish the performance between ‘normal’ and zombie funds. Due to the absence of adequate interim performance measurements, this thesis applies different exits as an indication of success. We find that zombie funds are less likely to exit their portfolio companies compared to normal funds. This is true across all PE-backed exit types in our analysis. We also find that zombie funds are more likely to occur for smaller funds.