Journalists
Lauren covers private equity and supplements breakingviews’ M&A and media coverage in the US. Previously, she covered Wall Street at TheStreet.com and is a former media investment banking analyst at Deutsche Bank. Lauren is a graduate of the University of North Carolina, where she studied mathematics and finance and received a Masters from New York University in business and economics reporting. Lauren has also interned at Dow Jones and The Financial Times, and was an Olympic trial qualifier for the US Swim Team in 2000.
His buyout firm Apollo plans to leave the shadowy confines of GSTrue for the bright lights of the NYSE. That may grant Black greater liquidity and access to capital. But given Apollo's challenges, he should expect a lowlier rating than Henry Kravis and Steve Schwarzman command.
Freedom Communications, that is. The bankrupt publisher of the Orange County Register is hoisting the interests of its equity holders – including the heirs of founder and Ayn Rand follower RC Hoiles – over those of creditors. The old man would roll over in his grave.
The firms are buying Northrop Grumman’s defence consulting division for $1.65bn. The carveout looks like the opportunistic deals that were traditional before buyouts got huge. It has a manageable capital structure too. The "new" model for LBOs is becoming clearer.
The private equity firm is leading a buyout of drugs market research company IMS. But old-style LBO financing is missing. The buyers are putting in a whopping 40% as equity. The rest is coming courtesy of Goldman – and mostly from funds it manages, not its own balance sheet.
The advisory shop is spinning off its buyout funds at a price equal to just 1% of assets. That’s cheap. But it makes sense. The lumpy business made earnings difficult to predict. To rectify this, it would have needed to grow, which risked irking advisory clients.
The food company priced its offering below the anticipated range. Investors appeared worried about Dole’s debt, among other things. Its performance may serve as a warning to private equity funds hoping to unload assets still lumpy with leverage.
The Chicago family is selling around $1bn of stock in a deal that puts a $4bn-plus valuation on the hotel group. That's a big discount to Marriott. But given internal family squabbles and a stock overhang, that's probably warranted.
The largest US pension fund is bothered by the fees it has paid Apollo. It has already endorsed calls for lower fees and giving investors in private equity more say. If Calpers does put the screws on Apollo, other big investors - and other buyout firms - won't be far behind.
Blackstone, TPG and KKR have all tapped mezzanine funds for recent LBOs. The hybrid debt-equity financing plugs a gap that burnt banks aren't yet willing to fill. Some buyout firms have mezz funds in-house, too. And while it's pricier than straight debt, mezz is more flexible.
Fortress and Blackstone both went public in 2007 in high-profile, over-priced IPOs. Both have since been beaten heavily down. But their third-quarter earnings underline the larger Blackstone's apparently superior ability to diversify its business and keep investors on side.
Steve Schwarzman's alternative asset manager may not raise another record LBO fund like its $21.7bn 2007 leviathan. But relative growth does look achievable in a shrinking industry.
That’s especially true for opportunists like Hilton and TXU. When debt trades at a significant discount to par, borrowers can offer creditors a better than market price while still cutting their debt loads. But rebounding debt markets mean it is harder to make the numbers work.
Kirk Kerkorian may sell part of his 37% stake in the casino company. He could be looking for a little valuation validation. But the investor would have to believe in MGM's unfinished Las Vegas shopping centre - or count on a rebound in gambling revenues. Both are chancy.
The media mogul is selling Viacom and CBS stock to pay down debt at his holding company. After the offering, his economic interests in both will be around 7%. But he’ll keep more than 70% of the voting control. One more reason to avoid the stock.