While some private equity firms are
sticking to their knitting with traditional leveraged buyouts, Apollo Management is turning to more nontraditional methods to take over companies. Reuters
reports that Apollo's president Josh Harris laid out his firm's strategy at the SuperReturn private equity conference in Florida.
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"What we are doing is ... buying good companies with bad balance sheets," Harris said. "You can buy chunks of bank debt, buy chunks of bonds, work the company through the restructuring process, de-leverage these companies and end up with appropriate capital structures."
Harris also commented that he particularly sees opportunities in certain media, packaging and transportation sectors.
But, moreover, Harris' comments indicate a growing divide amongst private equity firms that Apax Partners' Martin Halusa pointed out in an interview with the Financial Times. With the credit crunch making large take-privates few and far between, many LBO firms have been branching out in an effort to put the billions they have under management to work, while others -- like Apax -- have decided to stick to their traditional expertise. - George White
See Reuters story
See Dealscape post on Apax
