The number of businesses seeking bankruptcy protection has risen steadily over the past 15 months, a trend that may continue if the liquidity from private equity that has kept some troubled companies afloat dries up, Bankruptcy Law360 reported yesterday. Statistics released by the Administrative Office of the U.S. Courts show that 6,280 businesses filed for bankruptcy in the first quarter of 2007, representing more than a 50 percent increase from the similar period in 2006, when there were 4,086 filings. While BAPCPA is widely credited with reducing the overall level of bankruptcy filings the recent lull in corporate bankruptcy filings is largely attributable to the availability of money from private equity, ABI executive director Sam Gerdano said. “There’s a lot of scrutiny of the influence of private equity now,” Gerdano noted. Ultimately, the long-term ramifications of private equity on businesses and bankruptcies will be best assessed on a company-by-company basis, not by generalizations, Gerdano said. “Every business is going to have their own story to tell,” he said.
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