The Pulse of Private Equity – 7/2/2018

New tax law to impact PE data


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Recent changes to the US corporate tax rate are a mixed bag for private equity. Reducing the top-line rate from 35% to 21% affects PE at both the fund and portfolio company levels, as both are structured as corporate entities in the first place. For portfolio companies in particular, that should lead to a climb in free cash flows in tandem with reduced tax payments.