The deepening economic crisis could see up to 40 per cent of private-equity firms go out of business within the next three years as their portfolio companies default on debts, according to one of the darkest outlooks for the industry yet published.

The Boston Consulting Group and Spain’s IESE Business School are predicting that, while 30 per cent of buy-out groups seem certain to survive the crisis, between 20 and 40 per cent of the world’s largest funds will fail.