Why ‘Payment-In-Kind’ Debt Is So Appealing — and Risky

When private equity firms buy up target companies, they rely on one major source of financial firepower — debt, and lots of it. But what happens when the interest on...

By Eleanor Duncan, Kat Hidalgo · Bloomberg Markets

When private equity firms buy up target companies, they rely on one major source of financial firepower — debt, and lots of it. But what happens when the interest on that debt jumps? For some, the answer is simple: Pay it later.