Private-equity firms are feeding at the debt trough again.
Debt levels in leveraged buyouts are nearing those of the last credit bubble, once more enabled by yield-hungry buyers of leveraged loans.
Demand for leveraged loans began picking up in the second half of the year. Individual investors began piling into floating-rate funds that buy the loans, adding to demand from the rejuvenated market for collateralized loan obligations, pools of loans to “junk”-rated companies that helped fuel the pre-crisis credit bubble.
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