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Swensen Comments
By Jeff Almond on 2010-03-14 21:49:07
When a company has been in business for a while and their earnings start to drop, that is when they start considering whether to keep the company going, or to sell out. In this particular case a business was bought out, but at a high fee.
David Swenson, the CIO at Yale University Endowment has told investors that he is not a big fan of the buyout by large investment groups. He thinks their only fundamental reason is because of the incentive that they receive.
He has put into statistics the increase of the fees over the last 10 years. According to him, Prequin, a data provider claims that right now over 61 firms earn more than $100m which is up from 18 three years ago.
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