Retail News

Private equity firms tied to retail bankruptcies

The Wall Street Journal 07/30/2017

A criticism leveled against private equity firms that acquire retail businesses is that they load their acquisitions with so much debt that it leaves them financially weakened to the point where they can no longer compete. Private equity-owned retailers, including Gymboree, Payless, rue21 and True Religion, are recent examples for which too much debt combined with dividends paid to investors has been cited as major factors in bankruptcy filings.

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