Institutional investors who need to place large sums of money without causing market shocks. Usually the company is much healthier on paper after the LBO; and to be fair some companies actually do turn it around and they end up being bargains. But a good number get caught in what I call the “PE Death Spiral” where they go through multiple rounds of LBOs and IPOs at a valuation growing right around inflation.

Yet every time they IPO their debt rating gets worse because they’re carrying more legacy debt, until finally it’s so laden no bank will fund another buyout, so there’s a fire sale on remaining assets and the company closes.