Understanding the Impact of Interest Rates on Private Equity and Business Valuations
Focus Investment Banking
APRIL 7, 2024
Cost of Leveraged Buyouts: PE firms often use leveraged buyouts (LBOs) to acquire companies, relying heavily on debt financing. Lower interest rates make this debt cheaper, enabling PE firms to execute more buyouts or bid higher for target companies. This market trend can raise the comparative value of similar businesses.
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