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Stocks A to Z / Stocks B / Berkshire Hathaway (BRK.A)
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Author: rogermunibond   😊 😞
Number: of 15055 
Subject: Deep dive on private equity and insurance
Date: 06/27/2025 11:17 AM
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https://www.ft.com/content/ee40241a-c568-4673-88df...

On FT Alphaville - which should be free.


Historically, PE business models have relied on PE firms or financial sponsors (general partners) raising funding at arm’s length from investors (limited partners) such as insurers, pension schemes, and family offices. Funds raised would then be used to lend to PE-sponsored corporates. The PE firm itself would retain limited risk on the underlying assets (eg high-yield bonds, leveraged loans), which they mostly originated to distribute to investors.

[However] . . . by acquiring life insurance liabilities, PE firms take control of how insurance premiums are invested and use these to, among other things, provide credit lines to PE-sponsored corporates.
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