The private equity funds’ aggressive acquisitions mania and the Willy Loman trauma

Abstract

Abstract and Prologue This writing was undertaken in mid-2006 when the private equity funds were riding along their upward trajectories, attaining their apogee some time in mid-2007 when the Blackstone Group succeeded in getting off its IPO – even attracting some billions of dollars of Sovereign Chinese Wealth Funds – with KKR waiting in the wings to do an encore. This was a period of time that fully justified the strident reference to the phrase “mania” in the title. But then comes late 2007 with its manifestations of metastases regarding investments in subprimes, SIVs, CDOs, derivatives, and other forms of financial instruments that have been allowed to spread throughout our corporate and financial systems without control and certainly without transparency. As a consequence, the private equity acquisitions binge and related mania are now in early 2008, in remission.