Leveraged buyouts cause defaults

Moody’s in June 2014 published a report analyzing 188 companies 14 of the largest US private equity firms purchased from 2004-07. The results were not pretty. Twenty-eight percent had defaulted on their debt. Most were formerly healthy businesses. Half of the ten companies that borrowed more than $10 billion to finance mega-buyouts defaulted.

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2 Comments

  1. bob kranz
    Posted October 2, 2011 at 6:22 pm | Permalink

    I truly believe that the information about Romney/Bain Capital and the companies that he helped starve/destroy (as well as the jobs lost ) should be a major campaign issue. Every other Republican candidate should be presented with the information and their feet should be held to the fire if they do not use the info. Smugness is not a virtue and Romney keeps “suggesting” how much business experience he has. This is not the kind of of business person we need leading this country.

    I am not affiliated with any of the other presidential candidates and would really appreciate any info you wish to share directly. Really enjoyed the “Buyout” even though it kept me awake many nights.

  2. Posted June 12, 2013 at 7:15 am | Permalink

    RIYADH: In developing countries like Pakistan where capital markets do not have much depth (liquidity), encouraging private equity investment plays an important part in ensuring that capital is available where it is required, and hence it is big propeller for economic growth.

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    Few people realize that the top private equity firms, such as Blackstone Group, Carlyle Group, and Kohlberg Kravis Roberts, have become the nation’s largest employers through the businesses they own.
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