Kanas is the main man

June 10, 2009

It was never a secret that former North Fork CEO John Kanas was the prime mover behind a group of private equity firms that recently acquired the assets and banking operations of Florida-based BankUnited, a failed lender that the regulators had to takeover. But bid documents submitted by the investor group reveal just how central Kanas was to putting the team of private equity buyers together.

The formal bid for BankUnited came from a company called JAK Holdings, LLC, an entity that listed Kanas as its sole member, according to bid documents submitted to the Federal Deposit Insurance Corp. It appears JAK Holdings is the entity through which private equity firms such as, WL Ross, Carlyle Group, Blackstone and other invested. Technically, JAK Holdings submitted its bid on behalf of the new BankUnited. 

Kanas is the sole signatory on the bid document, which was obtained by Wharton finance lecturer Ken Thomas pursuant to a Freedom of Information request. 

Documents obtained by Thomas reveal that the FDIC also received bids from TD Bank and  JC Flowers.

The prevailing bid from the Kanas’ led group put an asset “discount” on BankUnited of negative $3 billion. So-called negative bids are not uncommon in distressed bank sales and go into calculating how much the FDIC will have to contribute to the acquirer of a failed bank as part of the auction process.

In choosing the Kanas group, the FDIC called it the “least costly” option in terms of impact on the FDIC’s Deposit Insurance Fund. With banks continuing fail, don’t be surprised if you see JAK Holdings name pop up in subsequent bids.

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Has anyone done a full accounting of all the assets purchased by the carlylye group in the last ten years and an accounting of who the actual investors in carlyle group are?

There are strategically important assest including computer chip makers and whole swaths of ethanol producing corn fields being purchased by these unknown investors.

If their typical actions are repeated they will now restrict production so the prices will skyrocket.

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