Last updated: February 21, 2008 - 7:30am
PRIVATE EQUITY: IS DEAL FRENZY NEARING END?
[SOURCE: Wall Street Journal, AUTHOR: Henny Sender email@example.com]
It would be a fool's game to predict the end of the private-equity buying frenzy, but certainly some signals are there. Over much of the past two years, the prevailing private-equity mantra has been to buy as many companies as possible and then sell as much debt as possible to help pay for them. Now, the biggest private-equity firms are beginning to diverge in their views. Caution on the part of even some of the players could be bearish for stocks, coming at a time when one of the biggest supports for the stock market is the assumption that private equity will buy bad companies because they are inexpensive and good companies because they are good. Should private-equity firms pull back, that support could vanish. Some analysts say that without a widespread belief in the appetite of LBO firms for publicly traded companies, stock prices would be far lower.
See also --
* Avaya May Be Next Telecom Takeover Call
Telecommunications-equipment maker Avaya Inc. is in talks with private-equity and strategic bidders about selling part or all of the company, the latest sign that there could be a new round of mergers and acquisitions in the telecommunications-equipment industry.
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- Carlyle telecom Acquisitions
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- Growing the 'Private' Club
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- Clear Channel suitors reject offer by banks
- Clear Channel lenders threaten refinancing plan
- Private Equity’s Role in Communications Debated on Capitol Hill