Master of Science / Department of Agricultural Economics / Michael R. Langemeier / Retained ownership can generally be described as when a producer does not sell his or her calf crop immediately after weaning but keeps the calves for an extended period of time. This is a decision that is made by the cow-calf producer every year and may or may not change from year to year. For some, the decision is based on past practices while others will evaluate the market before making a decision. There are various levels of retained ownership that can be modified to fit a producer’s operation and can range from a preconditioning program to finishing the cattle in the feedlot. This study specified various retained ownership scenarios in order to be able to analyze the situations. Budgets were used to analyze the optimum phase of production at which to sell calves that is most profitable while taking risk into consideration. Specifically, budgets were developed for scenarios of four cow-calf herds, four backgrounding phases, two grazing phases, and six custom feedlot phases. These budgets were used to produce sixteen potential retained ownership scenarios. The scenarios range from selling the calves immediately after weaning to owning the cattle through finishing at the feedlot. Each scenario was then analyzed based on the net returns over a 10-year period. Additionally, the scenarios were analyzed based on net returns over feed costs. Target MOTAD was used to analyze the risk component of the scenarios. Although most of the net returns were negative for all scenarios, retained ownership showed a trend of improving net returns. However, along with the improved returns came a greater variability in returns which is unattractive to a risk adverse producer. Target MOTAD results on a net return basis selected the cow-calf only phase of production in all scenarios.

Data from the 2001-2002 Texas A&M University Ranch to Rail Program-South were used to determine factors that influence cattle feedlot performance and profitability. Steers (n=860) were classified according to sire (SBIO) and dam (DBIO) biological groups, kill groups (KILL), and entry month (ENTRYMON). Biological groups were determined by predominant genetic make up of the sire or dam. Traits evaluated included net income (NI), feedlot average daily gain (ADG), slaughter weight (OUTWT), carcass weight (CW), fat thickness (FT), longissimus muscle area (LMA), marbling score (MS), yield grade, (YG), medicine costs (TOTMED), and carcass value (CVL). Analyses of covariance were performed to determine differences between SBIO and DBIO, KILL, and ENTRYMON, and the influence of initial feedlot weight (INWT). Sire biological type had a significant effect on NI, ADG, FT, LMA, MS, YG, and CVL. Dam biological type and KILL had significant effects on all traits excluding TOTMED. Entry month accounted for no differences. Among SBIO groups, British-sired steers exhibited greatest values for ADG (1.39 kg/d), MS (457), FT (1.45 cm), CVL ($891), and NI ($25.62). Continental-sired steers exhibited the largest LMA (97.65 cm) and lowest YG (2.51). Brahman-sired steers exhibited the lowest ADG (1.32kg/d), MS (405), CVL ($859), and NI ($-17.80). Multiple regression was performed to determine which traits had the greatest effect on CVL and NI. Independent categorical effects were SBIO, DBIO, KILL and ENTRYMON, while independent continuous effects were INWT, ADG, FT, LMA, MS and TOTMED. Both CVL and NI were influenced by CW, FT, LMA, and MS, but not by ADG, INWT, or TOTMED. Phenotypic correlation coefficients were determined among all traits. Highest correlations were present between CVL: and NI, CW, ADG, and LMA (0.80, 0.81, 0.54, and 0.49, respectively). Strong correlations were seen between ADG and CW (0.63), FT and YG (0.87) and YG and LMA (-0.51). Marbling score was moderately correlated to CVL (0.30) and NI (0.30). This study indicates that a wide variety of traits interact to determine CVL and NI in retained ownership programs, and that maximizing carcass value does not ensure increased profitability.

With the price of corn now over $6 per bushel, and with feedlot total cost per pound of gain now approaching $1.00 per pound of gain there are new incentives to try and add weight to calves outside of feedlots. The question then arises of how to add weight to a calf in the most economical manner. There are many different feeding programs to consider. However, with few exceptions, the cheapest way to add weight outside of a feedlot usually involves the calf grazing for an extended period of time. Winter pasture grazing, wheat pasture grazing and corn stalk grazing followed by summer pasture grazing are examples of these programs. However, with the exception of California, most of the area west of the Great Plains lacks the resources and climate for most of these winter grazing programs. For those states, cattle producers can background calves through the winter and then allow them to graze pastures in the summer. Backgrounding calves is essentially taking calves at weaning and feeding them to heavier weights without placing them directly in a feedlot on a finishing ration. The overall objective of this research is to evaluate the level and variability of returns to several background feeding alternatives. The returns will be evaluated in an expected value-variance analysis and ranked using stochastic dominance procedures. It appears that there are several different background alternatives that producers could utilize to increase returns with an acceptable level of risk and add additional value to their calves.

This study examines the specific ways in which private equity firms influence their portfolio companies to enhance their value, with a focus on the relationship between the level of retained ownership and post-IPO performance. Private Equity firms influence their portfolio companies in specific ways to enhance their value. Private Equity firms are typically limited partnerships, and to realize the value created during the life of the investment, the exit strategy is crucial. An initial public offering is stated as the preferable exit. However, private equity firms usually stay invested in their portfolio companies for up to several years after an initial public offering. Their retained ownership is crucial for underpricing at the IPO and performance post-IPO. This study aims to discover this relationship and to determine its effects. It will contribute to understanding how the portfolio companies' price changes on the first day of trading and their performance, in the long run, is affected by the stake held by the private equity firms. This research will try to clarify the current uncertainty about the effect of underpricing that prevails. It will also fill the existing gap in the academic literature about performance. It can also be potentially helpful for investors. Given knowledge about how retained ownership by PE firms affects underpricing at the IPO and performance post-IPO, this study can help investors to make better investment decisions. However, it should not be seen as investment advice but rather as a contribution to increasing the investor's understanding and knowledge. Publicly listed portfolio companies in the Nordic region constitute the sample for the analysis, and pooled OLS is the econometric method used in this study. We utilized a panel dataset for performance and obtained 2411 unique observations. The long-run performance has been measured as 36 months following the IPO. Our findings indicate a positive relationship between the level of ownership held by the PE firm and both underpricing and performance. These relationships are both statistically significant on the 1% level. Control variables were also included to capture other possible factors that might impact our dependent variables. The positive relationship between the level of ownership held by the PE firm and performance was in line with previous similar research and our expectations. However, the relationship between the PE firm's level of ownership and underpricing was the opposite of what we expected. Previous research has also presented contradictory results, making it difficult to predict the relationship. We hope our results have contributed to clarity regarding underpricing and broadening existing literature about performance for private equity-backed companies.