From the Guardian:
Private equity firms are increasingly saddling companies with debt to pay themselves hefty bonuses, according to an industry-sponsored study.
A group of 47 private equity-owned businesses — including United Biscuits, sports chain Fitness First and casino operator Gala Coral — now have an accumulated debt of £71bn, up £13bn from their combined debt before they were taken over, said a report by BVCA, the British Private Equity and Venture Capital Association.
Of that £13bn, new owners directed £11bn towards acquisitions and capital expenditure programmes while £2bn went to pay shareholders of the private equity funds through measures such as special dividends.
No news you might say - vulture capitalists enriching themselves, but the reality is that this is them admitting that they borrow to pay themselves. And that is candid omission of stripping if ever I saw it. And not by any stretch of the imagination can that be called 'adding value'.
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