Private equity faces a too-big-to-exit challenge

Have some private equity-backed assets become too big to exit?

That’s a theme we’re exploring at Buyouts. We’re hearing that in some cases mega-fund GPs are looking for alternatives to traditional M&A sales for their largest companies as traditional exit paths have narrowed.

Some assets have grown so large that only a handful of other sponsors or strategic buyers could acquire them outright. And with the public markets having been mostly shut as an exit option, liquidity alternatives are limited.

It’s an ironic situation in that PE sponsors have successfully grown these businesses to a point where now an exit has become a challenge.

Take a look at these challenges.