M&A deals for PEF
got a quick question. can PEF do a decent M&A deal without putting its equity at all?
for example, is this the possible structure? --> PEF found a great target to invest in, but it's too big so it found a strategic investor. the deal size is $10bn. they decided to finance the deal - $5bn from their own equity (FI and SI) and $5bn from banks (M&A financing). for SI and FI, they also split the portion; let's say 1:1. FI just financed through its own equity. for PEF, it formed another fund and then it found all types of investors (LP, insurance, other banks/PEF, etc) for the remaining $2.5bn it's been responsible for.
- in that case, PEF doesn't have to invest any of its own equity? - then what's the point of doing this deal? - does it only get the transaction fees and that's it? if so, is that a lot?
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