Summary
The number of companies passing into the hands of private equity funds has soared as the era of low interest rates enables them to borrow money cheaply to make their acquisitions.
The companies are then typically stripped of excess costs and returned to the stock market in a few years, delivering a handsome profit for the owners.See the full content of this document
Extract
Cut the Flab and Count Cash
Yet there is no reason why quoted companies should not carry out their own housekeeping and make themselves more efficient rather than letting private equity firms bag the gains.
Open the financial pages of your newspaper every day and you will find a story about a private equity fund reaching for its wallet to snap up another well-known company.Dozens of publicly quoted companies, some based or with substantial businesses in the We...See the full content of this document
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