Private equity is a rebranded form of the 1980s leveraged buyout

Evidence

A type of investment strategy that buys, restructures, and sells private companies for profit. This extractive financial technique was originally known as a leveraged buyout in the 1980s and 1990s, but developed such a bad reputation that it was rebranded as the more opaque term private equity. In order to acquire the company, a PE firm, such as Bain Capital or Blackstone, raises the capital from asset managers, institutional investor funds, wealthy investors, and other PE firms. The acquisition is often supplemented by debt, which is raised using the target company as collateral; the target company is then saddled with the debt used to purchase it. — Andrew deWaard, Derivative Media, 492

Categorization

• DEFINE: Defines private equity precisely as a rebranded leveraged buyout with the debt-saddling mechanism spelled out.
• SEED: The rebranding of a tainted financial technique into an opaque euphemism is a strong essay angle on how financial language launders extractive practice.
• XREF: connects to: The mid-1980s bull market was driven by liberalization and leveraged buyouts — Donald MacKenzie, An Engine, Not a Camera: How Financial…, 816