Portfolio relationships are hanging by a thread

Managers feel they are under the Sword of Damocles as their investors pile on the pressure

The economic downturn has altered the way private equity firms relate to their portfolio companies, heralding a shift to a more active approach to ownership. In tandem with this change, private equity owners have increased their level of scrutiny of their businesses in a bid to identify potential problems early.

However, the change has led to unease in relationships between companies and private equity owners, with increasing tensions between management and buyout firms.

WSJ Logo