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by floatrock
28 days ago
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> Unless the company have a lot of fairly stable semi-liquid assets (like real estate)... That's exactly what happened famously with Red Lobster. PE sold off all the underlying real-estate to get the initial sugar-high and replaced it with a leasebacks. Those leases had escalating costs and fixed terms, which made it difficult to adapt to changing trends, and was a big contributor in what ultimately sunk it all. |
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