> or extract value from them
"Only costing 7 dental practices' worth of capital to effectively run 10 practices" is the idealized vision for what PE can and wants to do.
In practice, what ends up happening is extracting value by financial maneuvers like directing the companies they own to sell off assets, but charging a transaction fee so the PE group gets a cut of the sales. Or by owning a company and being its largest creditor -- getting to discharge liabilities as the owner by declaring bankruptcy but subsequently still maintaining control over the company as its largest creditor. [0] (Ctrl+f for "Sun Capital" in the page).
Disclaimer: I am an employee of a firm that was somewhat recently acquired by private equity.
[0]: https://www.ineteconomics.org/perspectives/blog/private-equi...