Displaying items by tag: private equity

A new provision quietly inserted into President Donald Trump’s latest tax bill would give private equity firms expanded tax breaks when they acquire companies and burden them with debt. This language, buried in the One Big Beautiful Bill Act, would increase the allowable deduction on interest payments—effectively subsidizing leveraged buyouts that often result in layoffs, wage cuts, and bankruptcies. 

Despite the provision’s potential to drive billions in tax savings for Wall Street, lawmakers have downplayed its implications, describing it only as an increase in business interest deductibility. 

By altering how interest deductions are calculated—without raising the 30% cap—the bill could hand private equity firms up to a 15% increase in write-offs, according to legal and budget analysts. Over the next decade, this tax tweak is projected to cost the government $200 billion in lost revenue, deepening concerns about corporate accountability and tax fairness.

Finsum: If CNL capital is a well-positioned private equity firm that could be in a good position to benefit to these legal changes. 

Private equity’s long-standing infatuation with oil and gas appears to be cooling. In the first quarter of 2024, only five energy-focused funds reached final close, and notably, none raised over $1 billion—a stark departure from the sector’s 2014 heyday, when fundraising totals topped $78 billion globally. 

Today, traditional hydrocarbons are taking a back seat as investor interest pivots toward renewable energy and broader energy transition strategies. This shift reflects growing pressure from institutional investors and ESG-conscious stakeholders who are increasingly wary of fossil fuel exposure. 

The fundraising gap highlights more than just a cyclical downturn; it signals a structural change in capital priorities. With clean energy rising to the top of the private capital agenda, oil and gas funds may need to reinvent their value proposition—or risk being left behind.

Finsum: CNL Strategic Capital is focused on value creation so this might be a great opportunity to explore the latest trends in PE. 

Empower, the $1.8 trillion 401(k) plan provider, will begin offering private credit, equity, and real estate investments in some retirement accounts later this year through partnerships with firms like Apollo and Partners Group. 

This move marks the largest entry yet of private assets into 401(k)-type plans, a $12.4 trillion market that Wall Street firms have long sought access to. While proponents argue private assets can enhance returns and reduce volatility, challenges remain—such as illiquidity, valuation complexity, and higher fees, which range from 1% to 1.6% versus the 0.28% average for typical target-date funds. 

Only select managed account services will offer these investments, with five employers already signed up to participate in the initial rollout. Allocations could range from 5% to 20% of a portfolio, depending on factors like age and risk tolerance.

Finsum: Private markets have definitely gone wide in the last decade but this sort of expansion could really help retirees. 

Blackstone has officially closed its fourth energy-transition-focused private equity fund, BETP IV, at its hard cap of $5.6 billion—marking a 33% increase over its previous fund. The firm’s Energy Transition Partners platform targets scalable investments that promote cleaner, more reliable, and affordable energy solutions across global markets. 

BETP has received multiple industry honors, including being named Private Equity International’s Energy Private Equity Firm of the Year for three consecutive years and winning IJ Investor’s 2024 Market Innovation of the Year for North America. David Foley, who leads the platform globally, highlighted strong investor confidence and the growing demand for electricity and grid efficiency as key drivers behind the fund’s momentum. 

Notable portfolio companies include Energy Exemplar, Sediver, Lancium, and Trystar—each playing a role in boosting grid resilience, energy modeling, and infrastructure. Blackstone has over $23.5 billion deployed globally.

Finsum: Private equities investment in energy solutions is something to keep an eye on in the new administration. 

Over a 27-year period ending in Q3 2024, Cliffwater found that U.S. buyouts (private equity) consistently traded at a 29% EBITDA multiple discount relative to public equities, contributing significantly to private equity’s historical outperformance. This discount, combined with higher earnings yields and potential valuation convergence, helped private equity deliver a 6% gross return premium, which nets to about 2.2% after fees compared to public markets. 

Several structural tailwinds reinforce private equity’s appeal, including a shrinking pool of public companies, persistently low credit spreads, and extreme valuation gaps between large-growth and small-value stocks. 

These valuation disparities, combined with the relative strength of the U.S. dollar, give large-cap firms and private equity buyers strategic advantages in acquiring smaller domestic and foreign targets. Meanwhile, the sluggish IPO and M&A markets in 2025 have led to a spike in discounted private equity secondary sales, offering further entry points for opportunistic investors. 

Finsum: Despite recent macro headwinds, these intersecting forces create a compelling backdrop for private equity to continue outperforming.