Type the words “worst private equity deal ever” into Google and the verdict seems savagely swift: topping the list is TPG’s $1.3 billion (€900 million) loss stemming from its investment in just-collapsed US bank Washington Mutual.
But the real story here isn’t the size of the loss. Instead, it’s that TPG – like many investors who have thus far been left with bleeding hands after trying to catch the proverbial falling knife – seems to have gravely miscalculated its risk.
