Advantages/Disadvantages of Private Equity???

Sorry I know this is quite a weird question but I have to write an essay on this and I have no idea!

Can anyone give me something to work with?

Also, does anyone have any suggestions to more companies that have been recently taken over by Private Equity firms apart from the AA?

FDC is a big PE deal that is still pending... TXU is another

The big reasons cited for most any PE deal are:
1. remove public company costs (auditors, accountants, investor relations)
2. the business is not meant for the scrutiny of quarterly earnings (in other words, the company could do much better if it could focus longer term)
3. the company is undervalued by the market due to complexity (think companies t are taken private and sold off by division, i.e. DoubleClick)
4. Poor management (PE guys think they could do a better job)

Disadvantages:
1. these deals are all levered to the hilt - their credit ratings go way down and are much more likely to default
2. PE firms generally gut the companies - cut costs, people - which can make people leave / change the culture

There is no substitue for doing your own research.

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