Top hedgies show Wall Street how it’s done

March 1, 2012

The $3 bln paycheck for Bridgewater’s Ray Dalio, as calculated by Forbes, hasn’t generated the outrage directed at investment bankers. The message seems pretty clear: Create your own business, reward investors, too, and don’t go public. Oh, and skip the government bailout.

Apax finds French twist on bankruptcy tourism

March 6, 2012

Buyout house Apax may use French law to weaken creditors’ hands in a debt restructuring. It is risky, and may draw accusations of opportunism. But this novel twist on the way continental companies relocate to the UK to use its bankruptcy law may appeal to other buyout firms.

Dodger blue outshines gold after $2 bln deal

March 28, 2012

The sale of the Los Angeles baseball team represents almost a five-fold gain in value since 2004. Gold aside, returns on sports franchises blow away most other major asset classes, including stocks. The demand for such trophy investments from the ultra-rich is stoking prices.

Private equity bubble hangover yields HR headache

May 11, 2012

Guy Hands will fund future bonuses at Terra Firma. The largesse is a bid to keep staff at his buyout firm, despite falling management fees and little prospect of “carried interest” on the current fund. The EMI debacle gives Terra Firma an acute case of an industry-wide problem.

Market signals turning point in U.S. gun debate

December 18, 2012

Private equity isn’t known for squeamishness - or for dumping promising investments. So it’s significant that Cerberus is selling firearms maker Freedom Group following the Newtown school atrocity. Gunmakers’ shares are plunging, too: big money is betting on tougher restrictions.

GE’s $4 bln swoop on Italian supplier is shrewd

December 21, 2012

The U.S. conglomerate will buy aerospace components maker Avio for $4.3 bln, or 8.5 times EBITDA. GE simplifies its supply chain, grows in the booming civil aviation market, and should reap savings. After a bumpy ride, Avio’s private-equity owners also reap a solid return.

A merger arb writes to Santa

December 24, 2012

It’s been another thin and bumpy year for betting on M&A. So, having finished the investor letter, one desperate European merger arbitrageur decided to write to Santa with a 2013 wish list. Breakingviews obtained a copy from a source close to the North Pole.

Heinz deal suggests Big Food deserves a fresh look

February 22, 2013

Strong brands and steady margins give food-makers’ strong finances a very long shelf-life. So makers of sauces, spreads and cereals may offer hidden value for patient investors. Warren Buffett-style bid or not, ConAgra, Danone, General Mills and others look cheap.

Satellite IPO launches risk tolerance into orbit

April 9, 2013

Intelsat is seeking a valuation on a par with listed rivals for equity worth $2.4 bln. However, the company, backed by BC Partners and Silver Lake, carries over $15 bln of debt. Growth also has been slow. If investors are ready to buy, it suggests confidence is heading sky-high.

J.C. Penney exposes inefficiency valuing CEOs

April 9, 2013

After hiring Apple whiz Ron Johnson, the struggling U.S. retailer’s equity value spiked by more than $1 bln. Less than two years later, his departure added $350 mln. Then, the return of ex-CEO Mike Ullman swiftly erased some $700 mln. Such big swings make no sense.