A number of medium-sized private equity firms have launched private debt businesses in recent years, as they look to expand their product suite and replicate the success of the alternative asset behemoths.
As more of them begin investing on both sides of the capital structure, a conundrum presents itself: do credit arms bankroll their firm’s own leveraged buyouts, add-on acquisitions and other transactions?
There are two schools of thought: those general partners that won’t consider using their debt capital to back their equity deals and those that will.
