| Private equity buy outs....what could possibly go wrong? on 08:25 - Jun 22 with 846 views | Guthrum |
That and the ability to effectively buy a business with its own money, by loading the debt onto the target company, rather than the purchasing fund. Then being able to walk away leaving it behind.
Funds are not satisfied merely to invest in businesses and reap profits thereby (which is how the system originally grew up, from the Middle Ages onwards). Now they have to actually take over, as only thereby do they gain the control needed to rapidly transfer debt, aggressively restructure, or whatever is required to make a profit as quickly as their own investors are demanding.
The side effects are that otherwise viable businesses are torn apart, jobs lost and, from time to time, economically dangerous bubbles created. |  |
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| Private equity buy outs....what could possibly go wrong? on 08:32 - Jun 22 with 814 views | BanksterDebtSlave |
| Private equity buy outs....what could possibly go wrong? on 08:25 - Jun 22 by Guthrum |
That and the ability to effectively buy a business with its own money, by loading the debt onto the target company, rather than the purchasing fund. Then being able to walk away leaving it behind.
Funds are not satisfied merely to invest in businesses and reap profits thereby (which is how the system originally grew up, from the Middle Ages onwards). Now they have to actually take over, as only thereby do they gain the control needed to rapidly transfer debt, aggressively restructure, or whatever is required to make a profit as quickly as their own investors are demanding.
The side effects are that otherwise viable businesses are torn apart, jobs lost and, from time to time, economically dangerous bubbles created. |
Neatly summed up Guthers...good luck staff at Morriston, Sainsbury and Tescos! |  |
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| Private equity buy outs....what could possibly go wrong? on 09:08 - Jun 22 with 770 views | Oldsmoker |
| Private equity buy outs....what could possibly go wrong? on 08:25 - Jun 22 by Guthrum |
That and the ability to effectively buy a business with its own money, by loading the debt onto the target company, rather than the purchasing fund. Then being able to walk away leaving it behind.
Funds are not satisfied merely to invest in businesses and reap profits thereby (which is how the system originally grew up, from the Middle Ages onwards). Now they have to actually take over, as only thereby do they gain the control needed to rapidly transfer debt, aggressively restructure, or whatever is required to make a profit as quickly as their own investors are demanding.
The side effects are that otherwise viable businesses are torn apart, jobs lost and, from time to time, economically dangerous bubbles created. |
My company was bought out in the 1980's by 2 yanks called Peltz & May.
They used junk bonds to buy the company.
These 'junk bonds' were so-named because they were high-interest loans with no colateral. If the investment failed then the lenders lost their money.
Your description of loading up the purchased company with the debt and then selling on is what these guys did. They bought in 1986 and sold in 1988 bagging about 150m profit.
The company survived but a lot of my workmates lost their jobs due to an 'efficiency drive'. This 'efficiency drive' amounted to sacking a load of people until departments and factories started to fail because they lacked the staff. They then rehired because the 'efficiency' level had been identified.
Not a recommended way to run a company especially as there was a culture of "If you don't like it, there's the door". |  |
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| Private equity buy outs....what could possibly go wrong? on 09:13 - Jun 22 with 745 views | BanksterDebtSlave |
| Private equity buy outs....what could possibly go wrong? on 09:08 - Jun 22 by Oldsmoker |
My company was bought out in the 1980's by 2 yanks called Peltz & May.
They used junk bonds to buy the company.
These 'junk bonds' were so-named because they were high-interest loans with no colateral. If the investment failed then the lenders lost their money.
Your description of loading up the purchased company with the debt and then selling on is what these guys did. They bought in 1986 and sold in 1988 bagging about 150m profit.
The company survived but a lot of my workmates lost their jobs due to an 'efficiency drive'. This 'efficiency drive' amounted to sacking a load of people until departments and factories started to fail because they lacked the staff. They then rehired because the 'efficiency' level had been identified.
Not a recommended way to run a company especially as there was a culture of "If you don't like it, there's the door". |
It's almost as if the workforce are slaves to the needs of other people's debts as well as their own! | |
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| Private equity buy outs....what could possibly go wrong? on 09:20 - Jun 22 with 733 views | bluelagos |
| Private equity buy outs....what could possibly go wrong? on 09:13 - Jun 22 by BanksterDebtSlave |
It's almost as if the workforce are slaves to the needs of other people's debts as well as their own! |
Like all slaves Bankster, you should be thankful for the existence you are permitted. Complaining won't change it. Just accept it and get on with it, it's the only way. |  |
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| Private equity buy outs....what could possibly go wrong? on 09:28 - Jun 22 with 721 views | Oldsmoker |
| Private equity buy outs....what could possibly go wrong? on 09:13 - Jun 22 by BanksterDebtSlave |
It's almost as if the workforce are slaves to the needs of other people's debts as well as their own! |
Unfortunately they are.
The board of directors have to maximise the profits for the shareholders first. The consideration of the workforce is secondary.
A payrise for the workforce is therefore seen as eating into the profits of the shareholders and must be discouraged. | |
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| Private equity buy outs....what could possibly go wrong? on 09:40 - Jun 22 with 699 views | BloomBlue |
Never trust an private equity that uses pension funds as most of the private equity buyers do |  | | |
| Private equity buy outs....what could possibly go wrong? on 09:48 - Jun 22 with 686 views | TractorWood |
| Private equity buy outs....what could possibly go wrong? on 09:28 - Jun 22 by Oldsmoker |
Unfortunately they are.
The board of directors have to maximise the profits for the shareholders first. The consideration of the workforce is secondary.
A payrise for the workforce is therefore seen as eating into the profits of the shareholders and must be discouraged. |
How do you explain massive banker bonuses then?
Lots of businesses are clearly focussed on their shareholders but lots are more complicated and have longer term strategies. AZ for one example have teams of people who solely focus on +10 year planning and billions in r&d. [Post edited 22 Jun 2021 9:50]
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| Private equity buy outs....what could possibly go wrong? on 21:56 - Jun 22 with 579 views | Oldsmoker |
| Private equity buy outs....what could possibly go wrong? on 09:48 - Jun 22 by TractorWood |
How do you explain massive banker bonuses then?
Lots of businesses are clearly focussed on their shareholders but lots are more complicated and have longer term strategies. AZ for one example have teams of people who solely focus on +10 year planning and billions in r&d. [Post edited 22 Jun 2021 9:50]
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The companies in industries such as Banks, Big Pharma rarely, if ever, get taken over by Private Equity because they're too expensive. These companies can operate as they please because their shareholder base is large and those that have a 10% share are rare, have no real say, and generally approve of these bonuses.
Private Equity seems to concentrate on Manufacturing, Retail, Dotcom etc.
They are looking for short-term profit not long-term investment.
Short-termism means cutting costs and 'adding value' which really means closing non-profitable subsidaries and redundacies. | |
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