IT’S the latest sign of leveraged mania hitting bondholders: Companies across Europe are piling on debt at the fastest pace in years to enrich their private-equity owners.
The controversial practice known as dividend recaps is growing as investors gorge on every credit risk while sponsors extract income as they await the economic rebound.
“If people want to put capital to work they’re just buying anything with a bit of yield, regardless of what proceeds are for, ” said Mark Benbow, a high-yield fund manager at Aegon Asset Management. “Hold your nose and harvest income.”
