Private Equity Gets Double Bageled

Originally Published March 25, 2008 5:15 PM

Private Equity should be limping until 2009.  You know its bad out there when mutual fund managers are considered to be higher on Wall Street’s food chain.. The PE crowd cannot seem to get deals closed.

A $19 billion buyout of radio station owner Clear Channel Communications is close to collapse, the Wall Street Journal reported on its Web site on Tuesday, citing people familiar with the matter.

The private equity firms behind the deals and banks set to finance it failed to agree on credit terms, the Journal reported. Thomas H. Lee and Bain Capital Partners reached a buyout deal with the company last year.

Oh, how the mighty have fallen.

Jeremy Grantham said it best back in August:

August 25th
Much hand wringing is now taking place over the consequences for private equity if a severe credit crisis were to occur. But the scary point I’m trying to make is that profit margins for companies owned by private equity will come back down under pressure from normal capitalistic competition. With or without a credit crisis, their geese are cooked.

With no thaw in site, the busiest place in midtown should be the Racquet and Tennis Club.

Bagel – winning (or losing) a set 6-0. Double Bagel: 6-0, 6-0

Clear Channel buyout deal near collapse
Reuters

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