The beginning of the year looked bleak for private equity. Debt markets were seized up and concerns were mounting about the fortunes of the businesses acquired in the huge buying spree the industry embarked on in 2006 and 2007.

As the year draws to a close, many of the worst fears have proved unfounded. Yet 2009 remains the worst year since the end of the 1980s leveraged buyout boom. And the industry is still trying to adapt its model to a world in which leverage is likely to be far more difficult to obtain.