Private Equity Companies Prepare for Euro-Collapse

According to a report in the Wall Street Journal by Amy Or, private equity firms are going all out to protect the businesses of their investee companies in Europe from the fallouts of the debt crisis, which could include slowing economic growth and austerity measures that could decrease spending.

One step has been to refinance the debt of portfolio companies or to otherwise prop up their capital structure. Given that banks have become increasingly risk averse and liquidity may be at a premium, these are measures that could sustain these investments over the course of a long slowdown....