Deals
Wall Street Bankers Pile Leverage Onto Riskiest U.S. Buyouts
- As regulators signal that more risk is okay, debt levels rise
- Banks including Goldman Sachs, Citigroup ramp up LBO lending
Pedestrians walk along Wall Street near the New York Stock Exchange.
Photographer: Michael Nagle/BloombergThis article is for subscribers only.
The U.S. signaled to banks that risky loans are okay. Lenders are now listening.
Goldman Sachs Group Inc. and Citigroup Inc. are among the banks that have doused companies with debt to an extent that would have been almost unthinkable a year ago, at least for a regulated bank. They’re piling loans onto corporations that are being purchased in leveraged buyouts, and when the dust settles, companies like health-care services provider Envision Healthcare Corp. could have total debt around 7.5 times a measure of earnings.