From 2004 to 2007, the titans of private equity tapped yield-hungry investors to raise massive amounts of buyout capital. Eager to deploy this easy money, they spent billions taking huge companies private, shattering records for mega-deals only to see them surpassed a few weeks later. The list of companies taken private includes many famous names: Toys 'R' Us, Hertz, Harrah's Entertainment, Tribune Co., and TXU, the Texas utility that set a record for buyouts in a deal worth over $44 billion.
Now many of those companies are staggering under the sheer weight of their debt. Bond investors, who once eagerly poured their money into the high-yield debt that made leveraged buyouts possible, have seen their holdings decimated. With the bonds that helped pay for some of the biggest private equity deals trading at less than 50 cents on the dollar, some worry whether the companies can stay afloat.
For details on eight big buyout targets that are now teetering on the brink, click through the following gallery.
