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It is bad for staff. Working for a company that’s been bought by a PE firm sucks. Almost always layoffs are coming and you’ll have to do more with your resource
by barry-cotter 7y ago
It is bad for staff. Working for a company that’s been bought by a PE firm sucks. Almost always layoffs are coming and you’ll have to do more with your resources or more Witt fewer resources.
Creditors are lending their own money. If they make a bad bet that’s on them, should have done better due diligence.
What PE is good for is increasing economic efficiency more generally which redounds to the benefits of consumers in the long run.
- Blackstone4 7y agoRegarding layoffs: "We find that the real-side effects of buyouts on target firms and their workers vary greatly by deal type and market conditions... This conclusion cast doubts on the efficacy of 'one-size-fits-all' policy prescriptions for private equity." [0] Pro Rata https://www.axios.com/newsletters/axios-pro-rata-ed716a8a-3790-4e1d-8a56-d05db1e4e803.html https://www.axios.com/newsletters/axios-pro-rata-ed716a8a-37... It really depends on the PE firm and the company. In the software space, there are large PE firms which have a tendency to cut headcount because in their view, public market CEOs focus on growing revenue at the expense of profitability. This tends to lead to excessive full time employees over and above best practises...so if the previous CEO overhired and the PE firm fired people....then it's the PE firm that's in the wrong right...end of story? I'm not saying you are saying this but this is the underlying vibe I get in these kind of discussions....