Did Private Equity Funds learn the lessons of 2008 ?
1/3/15
The Sunday Times ("Buyout Barons give Carney
the jitters", Business p.9) questions whether recent good times hide
a more sinister scenario. The highly leveraged borrowings that PE funds use to
finance their takeovers do increase profits when things go well of
course, but can also leave businesses in dire straits when things aren't
so clever. Now, sky-high levels of debt and the inflated prices being paid
for assets worryingly mirror conditions of seven years ago.
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