Hello,
Looking to gain some insight on how private equity pref investments are structured. From what I understand 8% is the norm. Is the dividend cumulative or non-cumulative and compounding or non-compounding?
Thanks!
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There are lots of different ways pref can be structured, but standard is for PIK interest to be both cumulative and compounding. Macabus is a good first source for learning about this type of thing.
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