Kellogg might make Heinz-style Buffett target

June 3, 2014

The $25 bln cereal giant’s stock is up on M&A talk. Kellogg may be too big for a Hillshire-like takeover battle and has too much debt for an LBO to be palatable. But an equity-rich deal like the Sage of Omaha and Brazil’s 3G cooked up last year for ketchup-maker Heinz might work.

Henry Kravis cultivates private equity perennials

May 30, 2014

U.S. firms like his are selling companies to each other at a record pace. Such deals are dubious, especially given how much capital is stockpiled. But KKR’s $1.6 bln buyout of landscaper Brickman and quick merger with rival ValleyCrest suggest the grass can indeed be greener.

Silicon Valley exceptionalism only travels so far

April 28, 2014

Airbnb has been sassing its way around New York, whose attorney general suspects the residence-sharing site’s users are breaking the law. A better lodging mousetrap and $10 bln valuation may resonate in the Valley, but it doesn’t mean nearly as much beyond the tech echo chamber.

Blackstone leaves a trail of money to follow

April 17, 2014

The buyout firm generated record quarterly earnings, in stark contrast to Wall Street’s slog. It’s the latest sign of a power shift from banks to shadow banks, broadly defined. Having confined big lenders, watchdogs could pick up the scent on Steve Schwarzman and his ilk.

U.S. government has chance to borrow very long

October 3, 2011

Orson Welles once hawked Californian wine using the tagline: "Paul Masson will sell no wine before its time." The same could be said about the U.S. Treasury and 50 or 100-year bonds. Maybe it's finally the right moment to actually sell some.

Apax misses with HIT disposal

October 24, 2011

Mattel's $680 million purchase of HIT Entertainment, the company behind kids' characters Bob the Builder and Thomas the Tank Engine, brings a sorry tale of private equity ownership to a close. But uniting Bob with Barbie does not necessarily mean they'll live happily ever after.

Capitalism takes three big hits in one day

November 1, 2011

It may just be an unhappy coincidence. Still, there was a common theme to three pieces of bad news from different parts of the financial world on Tuesday. Monuments of financial folly are falling apart and the debris is hazardous.

Loan hangover will cast pall over European buyouts

December 2, 2011

Banks have been caught out again. As in 2008, loans for European private equity deals have proved hard to resell or refinance in the bond market. Today’s backlog is smaller and the financial hit is modest. But new buyouts can expect less debt, higher rates and tougher terms.

LBO debt gluttons have now gorged on equity too

December 23, 2011

Buyout barons are sitting on nearly $400 bln of cash committed by investors - or over $1 trln of purchasing power. A big slug of it belongs to mega-funds at or approaching their use-by date, pressuring firms to deploy capital or return it. Expect some overpriced deals in 2012.

Private equity skewered by Romney-bound arrows

January 10, 2012

The assault from fellow Republicans on the front-runner’s record at Bain makes for an absurd spectacle. Huntsman’s family business agreed to an LBO while Gingrich advised Teddy Forstmann. The slings won’t derail Romney, but the collateral damage could hurt the buyout industry.