LBOs: The new deal

The private equity world’s best days have certainly passed. That doesn’t mean the leveraged buyout is an extinct creature. Deals will get done again. But many of the ingredients that financial alchemists like Henry Kravis and Steve Schwarzman used in recent years to cook up their riches are no longer available to them. As a result, they and their investors must adjust to a future where their investment returns suffer. To illustrate just how different the new world of private equity returns will...