The credit crunch plot thickens.

A group labeling itself only as ”The Syndicated Debt Covenant Review Roundtable” took out a half-page ad in today’s Wall Street Journal that read: “Sophisticated Lenders: Demonstrate Your Sophistication! Take back Your Rights!”

The ad calls on lenders to demand an end to “unrestrained collateral sale, release or substitution” and insist on “fixed, determinable dollar amounts of equally secured debt.”

Leveraged loans, the debt behind much of the private equity boom that often lacks traditional safeguards, have caused lenders serious concern with the economic picture worsening.

The ad was taken out for “educational purposes” according to Jacob Cherner, who said he was a spokesman for the group, which is backed by “traditional syndicated lenders” like pension funds or regional banks. Cherner declined to name the group’s supporters — and said that one goal was to demand that investment bankers return to standard covenant  packages and that the group may post on its Web site public credit agreements provisions for deals in the market.

Market sources speculated that one group backing the mystery ad may be Beal Bank, which is affiliated with CSG Investments, Inc., Loan Acquisition Corporation, and Beal Mortgage Services. A call to Beal Bank on the matter was not returned but Cherner has been previously associated with Beal affiliates, who reportedly paid for a WSJ ad last year regarding a lending agreement. The bank was founded by Andrew Beal, a Texan billionaire who has reportedly bet millions in poker games.

And in the Feb. 18 issue of Barron’s, Sotheby’s realty group took out a half-page ad for “Distressed Florida Real Estate” portfolios from $5 million to $350 million. The sellers weren’t named and an email to Sotheby’s was not returned.

The ad, which offered a “Wholesale Bulk Purchases Opportunity With Accelerated Disposition at Retail Prices in Pre-Determined Time Frame,” is for “Serious Inquiries Only” — but with vultures starting to circle, that’s probably only a matter of time. 

(Image: Dutch magician and illusionist Hans Klok. Reuters file)

Private equity is still sexy in Italy. Ducati’s key shareholder plans to launch an offer for the whole of the $670 million company and delist it, according to Italy’s financial daily Il Sole 24 Ore. Without citing sources, the newspaper said Investindustrial, which owns 29 percent of Ducati, could launch the offer as early as the end of the week. Investindustrial is a private equity firm with 1 billion euros of assets under management and 1.3 billion euros in resources to finance the operation, according to the paper. Ducati and Investindustrial, which is headed by the Bonomi family, were not immediately available for comment.

Brazilian iron ore miner Vale should make an announcement on takeover talks with mining rival Xstrata soon, but improved iron ore prices may not help raise its bid. Vale said on Monday that it had secured agreements from at least five major Japanese and one South Korean steelmaker, including Nippon Steel and POSCO, to raise term iron ore prices for 2008 by 65 percent from its southern mining system. “(The term price increase) is positive but does not necessarily raise Vale’s leverage to bid higher,” said UBS Pactual mining specialist Edmo Chagas. “Vale is in a comfortable position in respect to cash flow given the very decent price of nickel and iron ore in 2008 and 2009.”

Home-healthcare provider Amedisys Inc said it agreed to acquire home nursing and hospice services provider TLC Health Care Services for $395 million in cash. The company said it expects net service revenue for the year to be $1.025 billion to $1.075 billion assuming the deal closes early in the second quarter of 2008. Amedisys does not expect the acquisition to have a material impact on current earnings estimates for 2008, but expects the deal to boost earnings in 2009.

Fashion footwear name Steven Madden said that after a review of its strategic alternatives it will not sell itself, and has instead decided to buy back 12.9 percent of its outstanding stock. “This reflects the confidence we have in the strength of our brand and our business model,” said Walter Yetnikoff, chairman of the Strategic Review Committee. In its last results statement, the company said a lack of strong direction in footwear fashion and softer retail trends had sapped its earnings.

Berkshire Hathaway said it holds 8.6 percent stake in Kraft Foods worth about $4.3 billion, making it the company’s largest shareholder. Analysts said the investment fits in well with Warren Buffett’s (pictured left) ethos: Kraft has strong brands with good cash flow and is available at a relative discount. Shares of the food company surged in after-hours trading; regulators sometimes let Berkshire delay disclosures so investors cannot try to copy Buffett before he is finished buying.

NYSE Euronext has agreed to buy a 5 percent stake in Indian commodity bourse MCX for $55 million, in an attempt to get a slice of the country’s commodities boom. The Indian government allows foreign companies, funds and exchanges to acquire up to 49 percent of a commodity bourse, but single holdings are capped at 5 percent. NYSE also bought a 5 percent stake in the National Stock Exchange, India’s biggest stocks bourse, for $115 million last year.

Indonesian state miner Antam said it may buy up to 18.7 percent of Freeport McMoRan Copper & Gold Inc’s Indonesian unit in a deal expected to be worth about $3 billion. Antam, which is seeking to buy gold producing assets, said it had received “verbal support” from Indonesia’s state enterprises ministry to acquire the stake in PT Freeport Indonesia, the unit of the U.S. mining giant which owns and operates the huge Grasberg gold and copper mine in the province of Papua.

China’s CITIC Securities is renegotiating its deal to swap stock and debt with Bear Stearns to reflect the U.S. brokerage’s slumping share price. The Chinese securities house expects to get a 9.9 percent stake in Bear Stearns, compared with an original plan for 6 percent, according to two people with direct knowledge of the deal.

If successful, CITIC Securities — the brokerage arm of CITIC Group, which is directly controlled by China’s cabinet — would become the largest single shareholder of the U.S. investment bank. The total amount of $1 billion that CITIC Securities and Bear Stearns would invest in each other is so far unchanged, the sources said.

Yahoo is in talks on a possible deal with News Corp, a source close to the situation tells Reuters, but analysts said an alternative was unlikely to emerge to rival Microsoft’s bid, now valued at $42.1 billion. According to various reports, a potential deal would combine New Corp and Yahoo’s Web properties and include a cash injection from an unnamed private equity fund. Meanwhile, Japanese Internet firm Softbank Corp, under pressure from both sides in Microsoft’s bid for Yahoo, may hold out for more leverage but is unlikely to derail the bid.

Hula-Hoop and Frisbee maker Wham-O is set to make another gyration, with Hong Kong-based Grand Toys International Ltd agreeing to buy the storied toy maker for $35 million. Grand Toys is buying the company, whose founder Richard Knerr died last month, from Cornerstone Strategic Management Limited, a company owned and controlled by Raylin Hsieh, the wife of Grand Toys’ major shareholder, Jeff Hsieh.

Bill Gates may have splashed cash on Facebook, but that doesn’t mean he has to be on it. U.K.’s tabloid newspaper, The Sun, reported last week that the Microsoft billionaire had to delete his Facebook account after being hassled by thousands of fans.

The story also said Gates used to spend up to 30 minutes a day catching up with his buddies via Facebook, but he signed off after he started getting more than 8,000 friend requests a day and “spotted weird fan sites.”

But can Gates have really deleted his Facebook account? The New York Times reported earlier this week that being a member might mean you’ve signed a “lifetime contract” with Facebook. Apparently, Facebook servers keep copies of user information even after they have deactivated accounts, although the network responded to the story, saying it’s made it easier for users to delete their accounts permanently.

Facebook’s got ya, Gates.

Photo: Facebook founder Mark Zuckerberg, Reuters file

Every buyout rumor in the tech world seems to lead back to Google these days.  In the past week, blogs have linked at least three companies to Google. The latest is that Bebo, the social networking site with a huge fan following in the U.K., has sold itself for $1 billion and Google is the likely buyer. Now, as TechCrunch — which reported this on sources – says, Bebo would make perfect sense for Google because it fits nicely with Orkut, the Google-owned network that’s popular in Brazil and India.

Why it would make sense for Google to buy Plaxo is less clear, but that hasn’t stopped the rumor-mongering. Talk that Plaxo — unfortunately, still best remembered for relentlessly spamming users — put itself up for sale first emerged a few weeks ago, with a price tag ranging from $100 million to $200 million. The New York Times even reported Plaxo had hired Revolution Partners to handle the sale, but bankers at the firm were mum when we tried to reach them.

Both Plaxo and Bebo have cozied up to Google by joining its OpenSocial initiative, which is basically the tech giant’s response to the successful Facebook platform.

Not only that, but market talk of Google being interested in snapping up CNET Networks, currently battling a  bunch of activist shareholders, also pushed up CNET’s share price last week.

Google has declined to comment on these rumors, but at least we know that its enthusiasm in an advertising tie-up with Yahoo may be waning. So who is Google interested in? Potentially any number of companies going by the list of deals it has struck, but maybe it’s waiting for the Micro-Hoo outcome to announce its next step.

Photo: Reuters file

A global media company receives an unsolicited takeover bid with a hefty premium, and rivals scramble to put together a complex alternative offer.

Sound familiar?

Silicon Alley Insider reported last night that News Corp is talking to Yahoo about a deal that would keep the Internet company out of the hands of Microsoft Corp and its $44.6 billion takeover offer. See if you can follow along: The hypothetical transaction would combine Yahoo with MySpace and Rupert Murdoch’s other digital assets, along with a cash infusion from private equity and the outsourcing of search to Google.

Flashback to June: Pearson, General Electric, Hearst Corp, and yes, even Microsoft, all discuss ways to mix and match their various financial news assets to counter News Corp’s knock-out bid for Dow Jones. And we all know how that one ended.

Kara Swisher of the Wall Street Journal (and thus a News Corp employee) tackles the question with a bit of faux Q&A and a nod to the classic TV show “Kung Fu”:

Q: What about Yahoo’s alternatives to Microsoft? I thought they were talking about linking up with AOL yesterday? Now today, it’s News Corp. Didn’t both those companies publicly say last week that they were uninterested in making a bid?

A: Grasshopper, when you can snatch the pebble from the hand of the leaky investment banker, it will be time for you to leave.

Britain wants bidders to improve their offers for Northern Rock, the teetering bank that already owes taxpayers 25 billion pounds ($49 billion). Richard Branson’s Virgin Group has been told it is a front-runner ahead of a rival offer led by the bank’s management team. Northern Rock has been a major headache for Prime Minister Gordon Brown’s government, which is keen to avoid nationalizing Britain’s fifth-largest mortgage lender.

Answers Corp, owner of Answers.com, has terminated a $100 million public offering, blaming unfavorable market conditions. The company had planned to sell shares to institutional investors to fund its purchase of Lexico Publishing Group, the owner of Dictionary.com. The agreement to buy Lexico will expire on March 1.

Global miner Rio Tinto touted its 9 percent rise in half-year underlying profit as more evidence that a hostile $147 billion takeover bid by rival BHP Billiton undervalued the company. “There is clear water between the offer and the fair value of the company,” said Rio Tinto Chief Executive Tom Albanes.

Yahoo and Microsoft aren’t about to let their high-profile takeover battle get in the way of other, smaller deals. Microsoft announced a deal to buy mobile software company Danger on Monday for an undisclosed sum, and Yahoo said on Tuesday it has acquired video hosting firm Maven Networks for $160 million.

The rationale behind Microsoft’s unsolicited bid for Yahoo — to compete more effectively against Google — can be seen in both deals.

Microsoft said the Danger acquisition was crucial to its success to win consumers over to its brand of mobile Internet, at a time when Google is preparing to launch its mobile software platform, Android. Danger was co-founded by Andy Rubin, who is now running Android for Google.

Similarly Maven, which hosts and syndicates ads and video for media companies, could help Yahoo convince those companies to use its own platform rather than build their own or support rivals Google and Microsoft.

PE Hub’s Dan Primack adds more about the Yahoo-Maven deal:

Yahoo originally signed its letter of intent for Maven last November, and news first leaked out two weeks ago via blogs TechCrunch and NewTeeVee. Less than 24 hours later, however, Microsoft unveiled its hostile takeover attempt for Yahoo, and speculation ran rampant that the Maven deal was stalled. Apologies for lending my voice to that, as I’m now told that February 11 was always the close date, and it finished up as scheduled.

This sale is a big win for Maven’s venture capital backers - General Catalyst Partners, Accel Partners and Prism VentureWorks — which had invested around $24 million. The most recent round was a $12 million Series C round in mid-2006, at a pre-money valuation of just $30 million. It’s particularly good for GC, which originally invested in 2003 at a $7.5 million pre-money. And GC could really use it, because it’s also pumped a ton of money into Maven competitor Brightcove - including a recent round at around a $210 million post.

Xstrata shares took a hit on Tuesday after a report that the mining company had rejected a $76 billion takeover approach from Brazilian rival Vale and that its suitor was close to walking away. The Financial Times quoted people close to the matter as saying London-listed Xstrata and its 35-percent shareholder, Swiss commodities trader Glencore, had rejected a cash-and-shares proposal pitched at just under 40 pounds a share and were holding out for about 45 pounds a share. The market isn’t so sure that a richer offer is forthcoming: Xstrata shares fell 2.4 percent to 37.15 pounds, one of the biggest losers on the FTSE 100.

Activist investor Ralph Whitworth of Relational Investors LLC is in advanced discussions to take a seat on the board of Sprint Nextel Corp, according to several reports. Relational Investors has a 1.9 percent stake in Sprint and has been pressing for strategic change as the U.S. No. 3 wireless operator has lost market share. Whitworth has already shown that his opinions carry some weight — Last October, he threatened a proxy battle unless Sprint dealt with its leadership. CEO Gary Forsee stepped down later that month.

New York developer Harry Macklowe has been served with a notice of default related to  four properties, in a move that could eventually lead to foreclosure, according to a report in the Wall Street Journal. Macklowe has been negotiating with lenders including Vornado Realty Trust over a total of $7 billion of debt on seven Manhattan buildings, but the possibility of a foreclosure action has increased because negotiations on the debt have bogged down.