Amit Chokshi_

Follow Up to 'Private Equity Buyouts: The Five Cs'

The massive coverage of the LBO wave is a few years overdue. 2004 and 2005 has massive dividend recaps, some satellite deals like Intelsat were recapped within one week after being purchased by their sponsors. The peak will come after the money's been invested and a few busts have occured. It's part of the typical cycle. The 1998 vintage PE funds were huge in terms of capital raised for the time and the majority have severely underperformed due to investments in the TMT sector.

As long as rates remain low PE funds will have all they need to do deals. They aren't buying bad businesses, they are buying stable businesses and juicing their returns. When Bain bought Burlington Coat Factory and now Outback, they're not changing much around. Those companies aren't going anywhere and a little leverage will juice their returns.

As for the PE/movie deal, that's been going on for a while. Tom Cruise getting into a PE deal is not a big deal, other entities like Relativity Media have been PE backed/financed.