PE Firms with Struggling PortCo’s
What’s the word on funds with struggling PortCo’s. Good to know so people know what they’re stepping into potentially.
What’s the word on funds with struggling PortCo’s. Good to know so people know what they’re stepping into potentially.
+197 | PE Recruiting Prep Guide - 2024 | 22 | 13h | |
+29 | Is Thoma Bravo fucked? | 17 | 3d | |
+27 | MF PE Analyst Programs Ranked | 24 | 3h | |
+20 | PE and Balance Sheet Heavy Businesses | 6 | 16h | |
+18 | Down after rejection | 8 | 3d | |
+17 | Is PE worth it? | 13 | 6h | |
+16 | Leverage Lateral BB Offer to Speed Up Buyside Processes? | 5 | 1d | |
+15 | PE Tier List - Any ideas? | 16 | 20m | |
+15 | Banking Exits - CS Degree or PE | 2 | 1d | |
+15 | How to participate in on-cycle before start date / away from NYC | 7 | 5d |
Career Resources
Hard to give specifics, but LMM PE seems to be in for it - lots of PortCo's bought in 2021/2022 at Peak EBITDA showing declining trends and high rates are really starting to bite. Doesn't take much of a decline in EBITDA (10-20%) for the cracks to start forming. The longer rates stay here, the more weakness you're going to see.
I'm very bearish on PE in general right now, especially those focused on certain segments of industrial, certain segments of HC, tech that was bought at 100x ARR, etc. That said, without having insight into their entire portfolio but rather only a PortCo or two, hard to really say for sure - one homerun can make up for more than 1-2 duds.
Naturally, PC will also get hit. While they're higher in the cap stack than the equity, losing their ass on 1-2 PortCo's is very hard to recovery from bc they don't have the upside equity has on other deals within the portfolio.
It's coming... just taking longer to play out than most have expected.
Typical lazy LevFin take
Voluptas commodi fuga omnis commodi. Animi at aut unde nihil.
Error quia nesciunt eligendi accusamus quibusdam quas omnis. Commodi magni totam molestiae. Exercitationem quo et similique necessitatibus et. Est natus et vel et in animi.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...