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Missouri

Recursion

(56,582 posts)

4. How it's possible: Private Equity buyout

Reply to Sherman A1 (Original post)

Wed Nov 14, 2012, 06:55 AM

Nov 2012

An outfit called Ripplewood decided the company was undervalued (ie, not increasing profit as quickly as it might). So, they borrowed a lot of money, bought up a controlling share of their stock, dumped that debt on the company, and started introducing "efficiencies". Sound familiar? It's the Bain plan that Mittens invented 30 years ago.

However, these guys weren't as good at it as Bain was, and it started crashing before they could unload it.

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