, Columnist
Private Equity's Bubble Vintage May Fizzle
It matters not just what you buy but when you buy it, and 2021 wasn’t a great moment to deploy capital.
Falling flat?
Photographer: Mladen Antonov/AFP via Getty Images
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Private equity firms that spent hundreds of billions of dollars on acquisitions at the top of the market risk a nasty hangover.
A combination of higher interest rates and lower valuations could lead to disappointing returns for deals struck in the frothy mid-2020 to early 2022 period, after which borrowing costs rose sharply. In industry parlance, it’s shaping up to be a disappointing “vintage.”