Private equity transactions involve investments by specialized firms into privately held companies. These transactions are characterized by the acquisition of equity stakes in target companies with the aim of achieving substantial returns over a defined investment horizon. Private equity firms often play an active role in the management and strategic direction of their portfolio companies, implementing operational improvements, financial restructuring, and growth initiatives to enhance value. Additionally, they work closely with management teams to execute exit strategies, which may include taking the company public through an initial public offering (IPO), selling to strategic buyers, or executing secondary sales to other investors.
