Breakingviews

BankUnited sends ominous sign with its white flag

By Rob Cox
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

BankUnited’s stock market return represented a rare glimmer of hope in American banking a year ago. Here was a failed Florida lender rescued from the dustbin, impregnated with fresh capital and led by highly incentivized and experienced managers. They planned to forge an exemplary industry path, rolling up small banks, squeezing out efficiencies and creating more competition. Now they’re waving a white flag.

It’s easy to see BankUnited’s decision to hire Goldman Sachs to canvass buyers as confirmation that Chief Executive John Kanas and his private equity backers wanted a quick flip all along. With the bank worth some $2.5 billion, they’ve already made their $900 million back and then some.

TPG can be forgiven its mile-high club fetish

By Jeffrey Goldfarb
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

David Bonderman hasn’t forgotten his first fling. The former lawyer parlayed his 1982 experience as trustee for Braniff Airlines into a deal to buy Continental Airlines out of its second Chapter 11 filing a little over a decade later. That successful bet enabled the Texas takeover artist to co-create buyout biggie TPG. Since then, he has continued to chase airlines the world over, including now bankrupt American. A recent failure hasn’t dampened Bonderman’s ardor.

Carlyle’s big payday does private equity no favors

By Jeffrey Goldfarb

 The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Carlyle Group isn’t doing its industry any favors. As part of the private equity firm’s initial public offering process, this week it revealed the lucre reaped by its three founders last year. David Rubenstein, William Conway and Daniel D’Aniello took home a combined $400 million in cash payouts. That’s on top of their nearly $4 million salaries and the profits on $200 million of distributions on personal investments in the firm’s funds. Carlyle’s timing is impeccable.

Ferretti’s yachts find fitting berth in China

By Quentin Webb
The author is a Reuters Breakingviews columnist. The opinions expressed are his own

Few companies embody the highs and lows of turbo-charged modern finance better than Ferretti. Once the luxury yachtmaker made a mint for private equity. Now a state-backed Chinese industrial conglomerate is buying it for at most a fifth of its peak value.

Predictions 2012: Upside down and inside out

By Robert Cole

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Planet finance has a propensity to turn itself upside down and inside out. It’s up to its old tricks again. A new collection of commentaries from Breakingviews sets the financial agenda for the next 12 months.

Double-dipping Twinkies tarnish bankruptcy process

By Agnes T. Crane

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Wednesday marked a day of mourning for American junk food aficionados – and not for the first time. Hostess Brands, maker of the cream-filled bright yellow Twinkie snack, filed for Chapter 11 bankruptcy just three years after emerging from the court’s protection. That’s not just a kick in the gullet for Ripplewood Holdings, the private equity owner that sank $40 million into the baker last year. The company’s failure leaves a greasy stain on the American bankruptcy process itself.

Fiat may find Chrysler deal is ticket out of Italy

By Rob Cox

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Italy is a global leader in fashion, food and art but comes up short on multinational corporations. That’s likely to change as Fiat plots a full takeover of Chrysler. Going global, though, comes at a price: Fiat’s Agnelli family may need to put pragmatism over sentimentality and move its headquarters from Italy.

China’s M&A dragon will blow hot in 2012

By John Foley
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

China’s M&A stars will align in 2012. If asset prices fall, and bank credit remains tight, the Year of the Dragon will give state-owned companies a chance to play to their two strengths: cheap financing and a mandate to acquire.

U.S. shale exuberance may need to be tempered

By Christopher Swann
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

France’s Total and China’s Sinopec kicked off 2012 with $4.5 billion of deals with Chesapeake Energy and Devon Energy, respectively, to drill for U.S. shale oil and gas. Vast resources and technology in America should keep attracting foreign buyers. But the reaction by Ohio officials after several earthquakes suggests political risks will intensify.

More corporate carve-ups to delight M&A bankers

By Jeffrey Goldfarb
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

In mergers and acquisitions, 2011 will go down as the year of the spinoff. Activity is on pace to hit $230 billion – six times 2010’s total and approaching a whopping 8 percent of global deal activity, according to Citigroup. With rocky economic conditions unlikely to give chief executives much reason to go shopping, 2012 could bring still more splits.