Private Equity

Convatec Buyout with Committed Financing!

By The Prince ⋅ May 5, 2008 ⋅ Post a comment

Two buyout firms, Avista Capital Partners and Nordic Capital, have agreed to purchase ConvaTec, a division of Bristol-Myers Squibb, for $4.1 bn. ConvaTec makes products for wound care and ostomies. Last spring this deal would have gotten almost no ink the press but now it is big news. Apparently this deal has committed financing. Pretty [...]

Sponsors Have Edge in Clear Channel Fight

By The Prince ⋅ April 22, 2008 ⋅ Post a comment

"This proposal is yet another disingenuous attempt by the banks to avoid living up to their commitments. The banks want to move this case into the back room because they fear that a public trial will clearly expose their misconduct," the private equity firms said in a statement.
Sounds like fighting words to the Prince. The [...]

Ken Moelis on Private Equity and Investment Banking

By The Prince ⋅ April 21, 2008 ⋅ One comment

A few weeks ago Ken Moelis, former Drexel, DLJ, UBS rainmaking banker, was interviewed on Bloomberg about the leveraged loan market and the changes he expects to see at investment banks. Few people are as well placed as Ken Moelis to make such forecasts and his commentary is fascinating. He also answers questions about his [...]

Private Equity’s Investment Style Drift

By The Prince ⋅ April 9, 2008 ⋅ 4 comments

Since the leverage loan market closed this summer, financial sponsors (private equity firms) have been pretty much absent from the buy side. Without debt financing, the sponsors have been unable to LBO new companies. This has had a profound impact on investment banking divisions since sponsors paid more in fees than other clients due to [...]

Private Equity MAC Attack!

By The Prince ⋅ April 5, 2008 ⋅ Post a comment

As more and more buyouts break the Material Adverse Clause (MAC) is rightfully getting more and more attention. Back in 2001 when the tech bubble burst and many buyouts starting breaking many sponsors pressured their bankers to invoke the MAC and kill deals that the sponsor no longer wanted to do (because the multiple didn’t [...]

Incentives Killed CDOs but CLOs Will Live

By The Prince ⋅ March 12, 2008 ⋅ 2 comments

An interesting article by Vipal Mongra, entitled "In death, afterlife,” appeared in The Deal on Monday predicting the future of Collateralized Debt Obligations (CDOs). In the article, Messieur Mongra speculates how CDOs may fare in comparison to other products/strategies that were pronounced dead only to rise again from the ashes. Most notably, the article points [...]

Private Equity is Down but Not Out

By The Prince ⋅ March 10, 2008 ⋅ 4 comments

A diamond is forever even if it spends years in a drawer only to periodically emerge for moments of brilliance. Business cycles continue but the existence/relevance of private equity should not be doubted. This downturn will pass and private equity will come roaring back with the largest war chest it has ever possessed and more [...]

Silver Lake’s Fundraising - Cheap Tech Targets?

By The Prince ⋅ March 4, 2008 ⋅ Post a comment

4 Mar 2008 - Silver Lake Partners announced yesterday that it closed its third tech-focused buyout fund with $9.3 billion in committed capital. LBO Wire and peHUB broke the story but Silver Lake has not confirmed it publicly. This fundraising started back in 2006 with $7.5bn target. Silver Lake’s previous fund closed at $3.6bn. Silver [...]

Covad Communications Buyout Arbitrage Update

By The Prince ⋅ March 4, 2008 ⋅ Post a comment

4 Mar 2008 - Check out this update from Intelligent Speculator on the Covad Communications buyout arbitrage opportunity. The Prince also blogged about Covad and attempted to handicap the deal based on public information. Intelligent Speculator points out that the deal is now closer since the acquisition has cleared anti-trust and the shareholders have approved [...]

Buy When There’s Blood in the Streets

By The Prince ⋅ February 27, 2008 ⋅ 2 comments

Baron Philippe de Rothschild, ever an opportunist, is said to have advised, “Buy when there’s blood in the streets.” Investors like Warren Buffett do just that all the time. Hedge funds have been set up specifically to take advantage of carnage in the markets. But for some inexplicable reason, many corporate C.E.O.’s can’t seem to [...]