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As was said in another thread, you only tend to hear about the private equity deals that go bad. Here are some of the big ones both good and bad: https://www.i
by kyrra 7y ago
As was said in another thread, you only tend to hear about the private equity deals that go bad. Here are some of the big ones both good and bad:
https://www.investopedia.com/articles/markets/111015/10-most-famous-leveraged-buyouts.asp https://www.investopedia.com/articles/markets/111015/10-most...
PetSmart was one success story I heard from this podcast: https://www.wsj.com/podcasts/the-journal/how-petsmart-solved-its-chewy-problem/3cb86a84-133d-4a21-b19d-7981e90d1508 https://www.wsj.com/podcasts/the-journal/how-petsmart-solved...
- satya71 7y agoYeah, some times it does go well. But the managers make money either ways, since they pay themselves back immediately using leverage.
- sailfast 7y agoThere is never a bad time to read Barbarians At the Gates to understand how the incentives work in these deals and to help judge for yourself whether they're going to work out or not. Spoiler / Hot Take: if you're overloading the company up with debt (even cheap, short-term stuff) and taking out cash based on "revenue projections" or "realized synergies" it's probably not gonna work out so hot when the loan comes due.
- mcrae 7y agoDebt isn’t dirty. There’s a reasonable case to make for having an appropriate debt load in terms of tax shields and motivating management.