Are Buyout Buyers On Strike?
Last night I had drinks with a middle-market lender, from one of those firms that still seems to be lending (albeit selectively… very selectively). It was a wide-ranging conversation, but we kept coming back to the paucity of new leveraged buyouts. The conventional culprit here is a lack of credit, but my conversant put forth an alternate theory (at least for the middle markets): Buyers are on strike. There clearly are fewer active lenders than in years past, he said, but there are still enough to handle far more deals than are currently flowing. The real problem is at the buyout firms themselves, which have lost confidence in their own ability to appropriately price and structure transactions.
29 January 2009•1 min read
