Pirates of Private Equity

An insanely lucrative investment strategy finally faces public scrutiny

By Adam Doster

Employees knew that Hastings Manufacturing Co., a family-owned auto-parts supplier 30 miles south of Grand Rapids, Mich., was in deep water. Facing financial pressure, 375 employees--two-thirds of whom were in the United Auto Workers' (UAW) bargaining unit--conceded $1 million in benefits to save their company, relinquishing newly negotiated [RETURN TO ARTICLE]

  • Reader Comments

     Page 1 of 1 pages

    It sounds like the Private Equity Funds are basically venture capitalists trying to make money by restructuring profitable firms who get more profitable when pay hikes, benefits and pension obligations are eliminated by restructuring. The thing that is so embittering is when the very assets of the company are leveraged by loans that make financing these arrangements possible. It’s like rubbing salt in the wound.

    Also by lowering wages and benefits, the very conditions of expanding financialization are created by lowering demand for consumer output making debt driven growth the only viable alternative. Clearly, the average worker is not benefiting from the growth of this trend and the increase in Public equity firms that are promoting more and more mergers and higher economic concentration. The bitter fruits will be more unemployment, debt, poverty and profits for the rich.

    United States Posted by cabdriverinchicago on Oct 29, 2007 at 11:35 AM

    Welcome to 1990 and beyond!

    Private Equity Funds are just the latest technique

    United States Posted by whattheheck on Nov 1, 2007 at 6:13 AM
     Page 1 of 1 pages

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