LBO Fever Stays Hot
Look for the sizzling market for leveraged buyouts to get even hotter in 2007.
Private-equity firms spent the past year playing a debt-fueled game of "Can you top this?" They pulled off one huge acquisition after another, unveiling a stunning $21 billion HCA deal in July and going on to gobble up giants like Clear Channel (CCU) and Harrah's (HET).
Now speculation is building that buyout firms are racing to pull the trigger on the biggest LBO ever, eclipsing the $25 billion bar set nearly two decades ago when Kohlberg Kravis Roberts bought RJR Nabisco. Predictions of a deal worth $50 billion, $75 billion, or even $100 billion have grown commonplace.
Though those figures are eye-popping, it's hard to argue with the logic. Private-equity firms took in more than $200 billion in new money from institutional investors in 2006, so buyers' wallets are fat. Meanwhile,
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