Aussie bid battle questions wine’s standalone case

August 12, 2014

Two buyout groups have submitted rival $3.1 bln offers for the world’s only big listed wine producer. Australia’s Treasury Wine could benefit from better management. But a fragmented market and low brand loyalty also suggests the business is not suitable for the stock market.

Behold the unversion: an inversion in all but name

August 8, 2014

U.S.-based data protection firm SafeNet may slash its tax rate as part of a cross-border deal. Instead of doing so by acquiring overseas, though, it is simply selling itself to Dutch digital security company Gemalto. It shows the limitations of a possible ban on inversions.

Private equity discord is best collusion defense

August 7, 2014

Blackstone, KKR and TPG are paying $325 mln to resolve allegations that they conspired to limit buyout prices. Three other firms previously settled for less. Carlyle is holding out for now. Legally, there’s safety in numbers. Yet they can’t even agree on how to resolve the case.

Treasury Wine resistance withers under KKR assault

August 4, 2014

The Australian wine maker has agreed to open its books after the buyout group raised its cash offer to $3.15 billion. The bid could yet turn sour, or other suitors may come forward. But Treasury’s spell as a listed company looks like it will soon be coming to an end.

U.S.-backed China tech shows investment curb folly

August 1, 2014

Foreign funds sank $5 bln into venture capital the first half of 2014 – three times what local funds raised. That the country’s next Alibaba will probably be funded by Silicon Valley investors may jar with national pride and official rules. But China’s economy is the undeniable beneficiary.

PetSmart activists barking up the right tree

July 9, 2014

Jana Partners was joined by another big shareholder in commanding the $6.8 bln dog food retailer to roll over and sell itself. Management could throw investors a bone with a bigger buyback. The better option is a deal with Petco, the rival controlled by TPG and Leonard Green.

Supercharged IPO tax spoils need splitting

July 8, 2014

KKR and Silver Lake are listing web hosting outfit GoDaddy. The use of what’s called an “Up-C” structure means the company will float with big tax deductions. IPO investors and existing owners will both benefit, but other IPOs with Up-Cs have seen more dubious arrangements.

Doubling down on First Data may be KKR’s best bet

July 7, 2014

The extra cash just injected into the payment processor means the $29 bln buyout has now absorbed a whopping $10 bln of equity. KKR seems, however, to have avoided the sunk cost fallacy of throwing good money after bad. A Breakingviews analysis suggests a return finally beckons.

Private equity’s bad habit: Asian minority stakes

July 1, 2014

Buyout firms are spending record amounts on non-controlling shareholdings in Asian public companies. History suggests such investments are fraught with risks. Pressure to deploy capital in a market short of traditional targets is driving a trend fee-paying investors dislike.

Harvard could get smarter about its endowment

June 12, 2014

Jane Mendillo, who ran the Ivy League university’s $33 bln portfolio for six years, is leaving. Predecessor Mohamed El-Erian is partly to blame for crisis losses, but Harvard overpaid for mediocre returns. Less of both Yale model investing and Wall Street pay may be in order.