The world’s largest ever private equity deal has just been agreed in the US, the sale of the Texas power company TXU to a group of investors headed by Kohlberg Kravis Roberts and Texas Pacific. They will pay just over 24 billion euros. Currently TXU is generating big profits. It is expected to announce that last year it earned about 1.9 billion euros. That was on turnover of nine billion euros, supplying 2.3 million customers.
Cash rich private equity firms are targeting ever larger companies. This deal won approval from environmentalists as the new prospective owners say they will not proceed with TXU’s plans to built more polluting coal-fuelled power station, but unions have accused equity firms of slashing jobs to create quick profits.