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    What’s private equity?

    By cooldude | December 28, 2013

    private equityIn operating companies which are not publicised and traded public on stock exchange, private equities are asset classes which comprises of debt and equity securities. In most cases private equity funds are responsible for making private equity investments to provide a working capital for nurturing the business. It is usually made by people or companies who have their own investment strategies, set of preferences and goals to take the company forward. Mostly the investment is done by a venture capital, angel broker or private equity firm to invest in a company which is not performing so well to build it better for greater profits in the future.

    The company which is not doing well is brought by these agents and private equity companies and then is sold in the market once it starts getting profits. It is seen as a very fruitful and good thing to do by the UK government as it makes weaker companies more susceptible to market fluctuations, s batter managing staff is made available it gives employment to people and sustainability to the ones who have already been working here. It is believed that over 30 million companied have invested around 80 million pounds on private equity market.

    However some people are really not happy with the situations and advantages private equity owners have. They are required to pay only 10% tax. This is because the government wants to improve and make bigger the private equity investments. However sometimes these investors (who are obviously very rich) end up paying a tax amount which is lesser than the cleaning staffs that cleans the office every day. The private equity business investments are being going on from 1980’s however during the years 2005 to 2007 when big companies like ‘sunGard’, ‘metro Goldwyn Mayer’ and ‘the hertz corporation’ were included in the major buyouts.

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