Private equity companies based in the region were on Tuesday warned against the pitfalls of relying on easy capital and excessive debt for transactions in light of the global financial turmoil, which has exposed the risks of doing business in that manner.
Dubai International Financial Centre (DIFC) Governor Omar Bin Sulaiman said the Middle East's private equity sector cannot ignore the lessons of the global financial crisis.
"The turmoil in Western countries has revealed the dangers of excessive debt levels and overly complex financial structures. It is very clear that private equity firms depending on easy capital alone will find it difficult to survive. Firms that over-leveraged for buyouts will struggle," he told a conference in Dubai on Tuesday.
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