US private equity crisis deepens as debt-laden companies collapse

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Private equity firms and the companies they own employ over 13 million, from startups to rural hospitals and large retailers, but experts’ concerns of collapse are growing

Retail stalwarts Saks and Eddie Bauer filed for bankruptcy. Kmart and JoAnn Fabrics are gone for good, a trail of layoffs and disappointed customers in their wake. Hospital giant Steward Health Care collapsed, costing thousands of jobs and leaving several communities without a local hospital.

These once-trusted US companies have one thing in common: they were owned by private equity investors, who load companies with debt when they buy them and squeeze out profits as they restructure.

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