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Private equity to reveal losses

Private equity firms are preparing to notify investors over the next few weeks just how much – or little – the companies they invested in are now worth, with many executives saying the reported fall in value will be 20-30%. Under regulations applied this year for the first time, private equity firms are required to value their companies at current market value rather than to merely disclose the original cost of the investment. By some calculations, the actual losses could far exceed 30%, as many of these companies were bought and taken private at the peak of the buyout boom – sometimes at a 25% premium to public market levels.

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