Private Equity’s Latest Financial Alchemy Worries Investors (1)

The first time Revelstoke Capital Partners asked investors if it could hold on to Fast Pace Health for longer than usual, they obliged. It was 2020, and a global pandemic had markets on edge.

So Revelstoke put a piece of the medical clinic chain into a new fund and found fresh investors to replace those who wanted their money back. The move allowed some backers to retrieve their cash without forcing the private equity firm to sell at an unattractive price.

Structures like this, often called continuation vehicles, or CVs, have since exploded in popularity as private equity firms limp ...