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Credit Crunch Could Stall Private-Equity Deals

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Credit Crunch Could Stall Private-Equity Deals

Economy

Credit Crunch Could Stall Private-Equity Deals

Credit Crunch Could Stall Private-Equity Deals

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The end of easy credit is hitting private equity firms especially hard. These are companies that aren't traded on the stock market and have fewer regulations — such as government-mandated earnings reports. They often produce huge returns, buying other companies on the cheap, hoping to sell them later for a profit.

Philip Coggan, capital markets editor for The Economist, talks with Andrea Seabrook about the effects of worries about defaults on private equity acquisition.