Moody’s Investors Service will on Tuesday warn that it will adopt a tougher stance when rating companies owned by private equity groups that were more “aggressive” in the recent dealmaking cycle. This could put companies owned by more aggressive buy-out firms at a relative disadvantage amid the downturn as they seek new deals once the credit markets improve. In a report, Moody’s corporate finance group ranked buy-out groups by their propensity to take out cash dividends from their US investments since 2002. Welsh Carson, Cerberus, Providence Equity Partners, Carlyle, Madison Dearborn and THL topped the list. KKR, Blackstone and Bain Capital were less frequent users of such “dividend recapitalisations”, Moody’s said.
