Trending Content - Private Equity Forum
Career Resources
WSO Free Modeling Series - Now Open Through
November 30, 2026
9 Free Financial Modeling Lessons
Get instant access to lessons taught by experienced private equity pros and bulge bracket investment bankers including financial statement modeling, DCF, M&A, LBO, Comps and Excel Modeling.
+Bonus: Get 27 financial modeling templates in swipe file
+Bonus: Get 27 financial modeling templates in swipe file
High Finance Applications
Guaranteed
Get at least one offer GUARANTEED
- 1:1 support
- 92% success rate
- 2,000+ mentor network
- Unlimited Live bootcamps
- AI for resume + LinkedIn
- Networking automation tools
- HireVue simulation tool
- Full course library
- Private Slack community
- 20hrs of mocks
- + much more...
-
Can also just be a sign credit markets are way more favorable than time of original deal, or that the portco has way outperformed its lender case and thus has a significant amount of leverage capacity that could be use to juice returns regardless of intended hold
Basically, you are sitting on an asset that has done well and has capacity for more debt, but can't deploy much cash in a responsible way to grow. Therefore, better to pull cash out of the business and reinvest elsewhere.
I think a certain level of debt also keeps the team running the company on their toes/disciplined. There's a lot written on the level of discipline you get with a healthy amount of debt...opinions may vary.
Reminder to self: I’ll post on this after dinner, sending kids to bed. A couple examples to illustrate if I’m up to it would give u the answer u need. Good answers above tho on leverage capacity N stuff
Officia nesciunt esse iusto unde quisquam dolorem accusamus quam. Accusantium id dolores laborum sint. Error ut ullam dolor vel voluptates maiores.
Et modi inventore debitis sint eveniet. Nemo ut tempora repellendus perferendis ex sint quidem.
Odit sequi qui nemo reprehenderit incidunt libero dolorum. Repellendus quis vero in enim nesciunt architecto. Qui et quam labore dolorum error similique eveniet. Aut aut voluptas doloribus rerum ea ad.
Beatae eveniet natus unde atque ab. Ea consequatur quasi eos quas et nesciunt. Voluptatem labore sed deleniti et enim mollitia aut.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...