Private equity firms turn to debt-funded payouts as exit bottleneck drags on

Private equity firms are increasingly borrowi ng against portfolio companies to pay themselves Bloomberg

The resurgence of dividend recaps reflects a broader challenge facing the industry: Global Private Equity Report (pdf)

This is creating pressure to return money to limited partners some other way:

The exit market is showing signs of recovery, but not enough to clear the bottleneck:

As a result, firms are increasingly turning to alternative liquidity tools:

Those alternatives remain relatively small:

MARKETS THIS MORNING

Asia-Pacific markets are trading up this morning

Interest rates (CBE)

S&P Egypt Sovereign Bond Index

S&P MENA Bond & Sukuk

VIX (Volatility Index)

The EGX30 rose 0.1% at yesterday’s close