Professor Glenn A. Okun
Bloomberg reported this morning that Bobby Le Blanc, chief executive officer of Onex Corp., a $50 billion private equity investment firm, confirmed the alternative investment drought first described by the Rabid Capitalist on August 7 (see https://therabidcapitalist.com/2023/08/07/private-equity-drought-the-next-liquidity-squeeze/ and https://therabidcapitalist.com/2023/09/27/alternative-investing-drought-2/ ). Yesterday, he cited higher interest rates and diminished liquidity as the causes for the worst fundraising environment in memory at the company’s investor day.
Rising borrowing costs, hesitant banks, and concerns of a recession have all weighed on private equity. In addition, some institutional investors have exhausted their ability to engage in illiquid assets after reaching allocation limits during the market decline of the previous year.
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