PE Eager To Keep Investors Sweet With Dividends Deals

The race is on. Eager to return cash to investors before capital gains taxes are hiked at the start of 2011, and in order to keep investors sweet, private equity (PE) firms are rushing to complete dividend recapitalisations. With the looming threat of tax cuts made by the Bush administration back in 2003 expiring at the year-end, dividend-related financing volume reached a post global financial crisis peak at US$6.4bn in October, comprising some US$5.7bn of loans and US$700mn of bonds - according to Standard & Poor's Leveraged Commentary and Data (LCD).

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