Joint ownership between family and steward private equity investors: an ownership-competence view

The study sheds light on the dynamics that arise during joint ownership between family firm owners and (steward) private equity investors. Our embedded single-case study centers on one steward PE investor who acquired the majority shares of three family firms, with the family keeping a minority share and managerial duties. We provide a novel perspective on PE investments in family firms by focusing on a steward PE—an important type of PE that differs from “classical” PE in its time frame and in its value-creation approach. We unveil a three-step process of how the steward PE evaluates the potential ownership competence potential, reduces control hazards and increases the family’s ownership competence, and ultimately takes action to increase the joint ownership competence. Moreover, we identify specific mechanisms conducted by the PE to increase ownership competence. Our research contributes to research on PE and family firms and on ownership competence.