re: Apparently private equity is buying up small hospitals in LA

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The goal of private equity is as follows: 1) Buy a business and load it up with debt 2) Take a ton of cash out 3) Trim expeneses to the absolute bone, and usually beyond 4) Starve the business of resources / spending as much as possible, but not so much as to cause it to shut down, so they can flip it in a few years and make a ton of money and pass it on to the next group, or 5) If they go too deep and end up putting it out of business, just sell off the assets and get the remaining cash out that way.

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That is essentially what happened in the newspaper and radio business.


Private equity companies come in and start buying up small newspapers like the New York Time Group and consolidated management into Gatehouse Media. They then sold off the assets of buildings, offices, and even printing presses. They continued to purchase more newspapers and kept trimming staff and content after each merger and acquisition. Eventually they grew so large that they purchased Gannett and took the name.

On the radio side, Clear Channel was the king up buying up radio stations in several markets and consolidating operations first into stations groups and now almost central casting from a larger city with a small presence at the studio for sales and the few on air talent left.