How private equity dividend recaps work


With a former private equity executive running neck and neck for the presidency, the practices of PE firms remain in the media spotlight. One maneuver in particular – the dividend recapitalization – has come under scrutiny while it grows in popularity among PE firms.

What exactly is a dividend recap? Marketplace’s Paddy Hirsch takes to his whiteboard to explain:

How dividend recaps have grown, via the WSJ:

dividend recaps

See also:

– The Matt Taibi/Dan Primack kerfuffle over dividend recaps

– Wall Street insider The Epicurean Dealmaker: “Dividend recaps are surging because they’re the only game in town.”

Author profile

Mick Weinstein
Mick Weinstein
Mick is the Head of Editorial for Covestor, a financial journalist and online content specialist. Prior to joining Covestor, Mick was for five years the Editor in Chief and VP Content at stock market analysis website Seeking Alpha, where he built the editorial function as the site attracted over 3.5 million unique monthly visitors and developed an innovative platform for intelligent stock market discussion.

Mick is a graduate of the University of Michigan, Ann Arbor.