The following video is part of our "Motley Fool Exclusive Interview" series. In this segment, Fool.com analyst Brendan Byrnes interviews author and Bloomberg reporter Jason Kelly about his recent book, The New Tycoons: Inside the Trillion Dollar Private Equity Industry That Owns Everything.
One common strategy for private equity firms is "carve-outs," in which a PE firm buys a business unit of a large corporation. We saw this recently with Carlyle's purchase of DuPont's auto paint business, and United Technologies' sale of its Hamilton Sundstrand unit to a partnership of Carlyle and European firm BC Partners. In the following video, Jason explains why these carve-outs are attractive for both private equity firms, as well as these large corporations that shed the units.
