Tuesday, August 23, 2011

Prototypical Private Equity Investing

Many of our local investing associates and readers have been inquiring about private equity investments. The example below summarizes one of the more common private equity strategies referred to as a leveraged buyout.

The local Philadelphia 76ers basketball franchise were recently purchased buy one of the premier private equity investment firms in the world! Joshua Harris of Apollo Global Management led an investment that purchased the 76ers for between $270-300 million in July. This investment could essentially be considered a distressed investment because over recent years the value of the basketball franchise has steadily declined, especially since the organization parted ways with our last Philadelphia sports hometown hero, Allen Iverson! Regardless, this purchase is a typical investment for a private equity firm.

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