I agree, although there’s a lot of selection bias at work here: companies usually don’t get bought by private equity unless they’re already in distress, so whatever they were doing before the acquisition clearly wasn’t working.

C.f. Private equity entrance to the veterinary market. Were they all really distressed? The issue is valuation of company vs underlying assets, isn’t it? Distress is one way, but a solid company not squeezing all of the value out of its customers / capital is another.