What are these guys trying to do? [Business division goes private]

[Mr. Slant]

The following private equity transaction has taken place locally:
http://www.crainscleveland.com/article/20120112/FREE/120119927

For background, here's the company that sold off assets in this transaction:
http://en.wikipedia.org/wiki/Interpublic_Group_of_Companies

Substantial cost-cutting has taken place, including moving to less expensive offices and going from Microsoft Office to Google Docs.

So, uh... private equity guys come in, cuts the fudge out of expenses and fire the least profitable clients?
Penis and profit ensues?

Am I wrong in reading the first link above as a standard private equity maneuver?

[dzero]

IDK about it being a standard private equity tactic, but as general rule, when a company is taken private, you have many fewer reporting requirements and a much lower level of scrutiny from public regulators. My impression is that this does indeed give you a freer hand in how you manage the business.

As to the rest, private equity, sometimes referred to as vulture capitalists, will often make the sort of decisions you noted in an effort to increase the value of the parts of the business that remain after restructuring while at the same time cashing in on less profitable aspects of the business by selling them off.