The IUF's Private Equity Buyout Watch

"This is an absolute wonderful time" to be in the private equity business, Blackstone head Stephen Schwarzman has told Bloomberg. Blackstone is currently raking in fees "advising" insurance giant AIG on how to raise cash through selloffs in the wake of the gigantic 2008 bailout.

Blackstone and the other pe funds have been lobbying hard to shape the Obama administration's stimulus package, now headed for the Senate, to extract maximum benefit from possible tax relief provisions on cancelled debt.

Continue reading "'Wonderful Time, Wish You Were Here': US Buyout Funds Positioning to Profit from Potential New Tax Breaks " »

Posted on January 29, 2009 04:05 PM | Permalink

Desperate to move off the books over USD 43 billion in leveraged loans - loans it couldn't securitize and unload when the global credit crisis hit - Citigroup has found the ideal buyer: the private equity firms whose buyouts generated the loans.

Continue reading "Locusts into Vultures 2: Funds in $12.5 Billion Debt Buyback Deal " »

Posted on April 11, 2008 03:32 PM | Permalink

The UK-based brewers Scottish & Newcastle (S&N) have turned to private equity firms Blackstone and TPG in their efforts to wring the maximum out of their 50% stake in Baltic Beverages Holdings (BBH).

Continue reading "PE Firms Step into Brewery Wars" »

Posted on January 14, 2008 08:57 AM | Permalink

Blackstone's stock had plunged by over 40% since its 2007 IPO, but the advantages of going public became evident yet again when it used some USD 300 million in shares to help fund the January 10 purchase of hedge fund GSO Capital Partners for $930 million. Following closure of the deal, Blackstone head Schwarzman declared “I think now is a fantastic time to be growing this business globally.”

Continue reading "Financial Alchemy Continues as Blackstone Uses Stock to Fund…Hedge Fund Purchase for More Credit Deals" »

Posted on January 14, 2008 08:20 AM | Permalink

Blackstone has purchased the Hilton Hotels Corporation for USD 26 billion, paying a premium of nearly one-third over the company's closing share price. With the Hilton buyout, Blackstone now owns 2,800 hotels in 76 countries with nearly 500,000 rooms. In 2005, the Hilton brand's US and international operations were merged into a single company. Hilton employs over 100,000 workers worldwide.

The North American hotel workers' union UNITEHERE welcomed the acquisition, with union President Bruce Raynor stating that "This combination is good news for the workers of what will be the largest hotel owner in the world." UNITEHERE has a positive relationship with Hilton, and Blackstone, said Raynor, "had demonstrated its commitment to fair treatment for thousands of hotel workers in several major markets."

Posted on July 4, 2007 02:44 PM | Permalink

Cadbury-Schweppes' projected sell off it's US drinks division to private equity appears to be advancing on schedule, following the March demerger of the two divisions.

Continue reading "Cadbury US Beverages Sale to "Unlock" Shareholder Windfall " »

Posted on May 29, 2007 03:45 PM | Permalink

According to CNN Money.com, "Commercial real estate group Lightstone Group is buying Extended Stay Hotels from private equity firm Blackstone Group for $8 billion in one of the biggest hotel deals in history." (April 17 2007)

Continue reading "Blackstone Group sells Extended Stay Hotels to Lightstone Group for US$8 billion" »

Posted on April 18, 2007 03:30 PM | Permalink

Financial engineering to "unlock" value from companies acquired through buyout deals seemingly knows no limits. Undeterred by corporate governance critics of an IPO which will give investors no say in how it runs its buyout business, Blackstone now plans on booking profits from future sales at the time of purchase! "They are being more intellectually rigorous," said one accountant specialising in private equity. "It would allow them to book profit a damn sight earlier, like several years earlier." James Mackintosh of the Financial Times explains this rigorous exercise in creative accounting here.

Posted on April 16, 2007 06:56 PM | Permalink

As Stephen A. Schwarzman, CEO and co-founder of the Blackstone Group, splashed out on a US$3 million birthday party, it's clear where the wealth that's being sucked out of companies is ending up. As this report from ABC News reminds us (though we don't need reminding): "It's All About the Cash".

"These guys are not people who buy and hold. They buy, transform and sell. They're sort of a new beast out there."
Colin Blaydon, director of the Center for Private Equity and Entrepreneurship at Dartmouth's Tuck School of Business

Contine reading: Scott Mayerowitz, 'The New Titans of Wall Street - Unlike Past Entrepreneurs These Men Like to Hide in the Shadows out of the Public's Scrutiny', ABC News, 12 April, 2007.

Posted on April 14, 2007 08:42 AM | Permalink

“When private-equity firms and hedge funds kept low profiles, they were well out of harpoon range. They benefited from an enormous tax loophole that few but the cognoscenti knew about and a nice legal loophole that's familiar to people in the world of partnerships but that I'd never heard of until last week. These things have now emerged into public view, thanks largely to Blackstone's bid to become a publicly traded company. The harpoons are flying-as well they should be.”

Continue reading: Allan Sloan, 'Harpooning the Whale' , NEWSWEEK, 3 April 2007.

Posted on April 5, 2007 10:49 PM | Permalink

A web log linked to news stories on Blackstone Group has been launched by SEIU, Inside the Blackstone IPO:

http://www.blackstonerevealed.blogspot.com/

"The place to find all the news about the Blackstone IPO, up front, transparent and in one place. This site is hosted by the Service Employees International Union, wholly independent of the Blackstone Group."

Posted on April 2, 2007 12:34 AM | Permalink

According to Financial News (US), "The Blackstone Group has emerged as one of the world’s largest corporate borrowers after its private equity business took on about $80bn (€60bn) in debt over the past three years." Blackstone's planned IPO appears to be designed to minimise its tax obligaions, "according to the prospectus, Blackstone’s lawyers have advised the company it will qualify for certain exceptions and continue to be treated as a partnership for tax purposes after it goes public."

Continue reading: James Mawson and David Rothnie, 'Blackstone borrows $80bn', Financial News Online, 26 Mar 2007.

Posted on March 26, 2007 04:04 PM | Permalink

“Investors are lining up to buy the American drinks division of Cadbury Schweppes should the company decide to sell the business, which includes name brands such as 7Up, Dr Pepper and Snapple. Private equity firms including as Kohlberg Kravis Roberts and Texas Pacific Group are among those believed to be interested in bidding for the beverage group, while Lion Capital and Blackstone – who acquired the Cadbury bottling business in 2005 – have also been mentioned.”

“... there is concern that once the sale is completed the private equity speculators will turn their attention to the company's confectionary business.”

Continue reading: Duncan Tift, ‘Cadbury a sweet target for bidders’, The Birmingham Post, Mar 23 2007.

Posted on March 23, 2007 01:34 PM | Permalink

US-based private equity group's have traditionally had difficulty raising cash on US public equity markets. That situation may change dramatically as global buyout giant Blackstone Group prepares, according to the Financial Times, a US IPO (initial public offering) that would "raise billions of dollars, massively enrich its top executives and thrust the booming buy-out industry further into the public spotlight."

Read the article by clicking here.

Posted on March 17, 2007 02:11 PM | Permalink

On 15 March, Cadbury Schweppes annnounced plans to split up its confectionery and US beverages businesses. According financial news, the US beverages division may be bought by private equity groups like Lion Capital and Blackstone Group.

In 2005 Cadbury Schweppes sold its European beverages division, including the brands Schweppes, Orangina and Oasis, to Lion Capital and Blackstone for £1.3 billion pound.

Continue reading "Possible buyout of Cadbury Schweppes US beverage division by Blackstone and Lion Capital " »

Posted on March 16, 2007 06:26 AM | Permalink

"The leader of the Canadian Auto Workers warned against private-equity control of Chrysler, calling it the "worst-case scenario" for the automaker and a prelude to plant closures and worker layoffs.

"Our fear is private equity," Buzz Hargrove, president of the CAW, said in an interview yesterday. "They are not out to build cars. It could mean throwing a lot of people out of work and then reselling" the company."

Continue reading "'Canadian Union Leader Opposes Private-Equity Deal for Chrysler' - The Washington Post" »

Posted on March 6, 2007 01:54 PM | Permalink

Private-equity buyouts in the global hotel industry are on the rise. In many cases private-equity funds are interested in hotel real estate as a financial asset, and are not interested in running a hotel business. This has led to significant changes in the priorities and goals of hotel management. These changes are based on financial targets that include extraordinarily high rates of return to shareholders (15-20%), financing new hotel properties through debt rather than re-investing profits and the rapid acquisition and liquidation of hotel properties as ‘real estate assets’.

Continue reading "Private-equity buyouts in the hotel industry" »

Posted on February 22, 2007 11:06 AM | Permalink

In February 2006 Lion Capital and Blackstone Group acquired the European Beverages Division of Cadbury Schweppes plc. The beverages division, formally known as “CSEB” and now “Orangina SAS”, was acquired for US$1.85 billion.

Continue reading "Lion Capital and Blackstone buyout of the European Beverages Division of Cadbury Schweppes" »

Posted on February 21, 2007 01:56 PM | Permalink

In October 2006 the Blackstone Group and PAI acquired United Biscuits (UB) from private-equity firms Midocean and Civen for 2.3 billion Euro.

Continue reading "Blackstone and PAI acquisition of United Biscuits (UB)" »

Posted on February 21, 2007 01:48 PM | Permalink

In 2005/2006 the largest private-equity fund in the world, Blackstone Group, ranked first in the top hotel owners in the Americas according to a report on hotel ownership produced by Jones Lang LaSalle Hotels.

Continue reading "Private-equity fund, Blackstone Group, the top hotel owner in the Americas" »

Posted on February 21, 2007 01:06 PM | Permalink

On 12 February 2007, the Blackstone Group announced announced a buyout of Pinnacle Foods Group Inc for US$2.16 billion. Pinnacle Foods is a leading manufacturer, marketer and distributor of branded food products in the US and Canada.

Continue reading "Blackstone Group buyout of Pinnacle Foods" »

Posted on February 12, 2007 01:32 PM | Permalink