Time to reap some green shoots? Private equity firm Blackstone plans to list up to eight of its portfolio companies, aiming to make more hay from improved stock markets. Rival Kohlberg Kravis Roberts & Co’s Dollar General filed for an initial public offering of up to $750 million in August, and KKR is considering others, sources previously told Reuters.

Blackstone is positioning one company — hospital staffing firm Team Health — for an IPO and evaluating the potential for seven others, a source tells us, citing a letter sent from Blackstone to investors. The letter also says Blackstone is in the process of selling five companies outright, which it sees generating aggregate proceeds of $2.8 billion.

One of the exits is Kosmos Energy’s Ghanaian oil interests, the source who has the letter said. Sources previously told Reuters that Exxon Mobil had agreed to buy Kosmos Energy’s stake in the Jubilee field. Kosmos is backed by Blackstone and Warburg Pincus.

British Prime Minister Gordon Brown plans to outline a sale of government assets on Monday aimed at raising 3 billion pounds, according to a draft speech provided by his office. The sale will be carried out over the next two years and include betting company Tote and the cross-channel rail link between the UK and France.

In other stories reported by the media on Monday and over the weekend:

British bank Lloyds has lined up a syndicate of investment banks to underwrite a 11 billion pound rights issue, the Sunday Times reports, without citing sources. The deal would be linked to Lloyds’ attempts to reduce its participation in the UK government’s toxic asset scheme.

Barclays is planning to spin off a 4 billion pound portfolio of complex credit assets as its presses ahead with a process to clean up its balance sheet, the Financial Times says, quoting people familiar with the matter.

Chinese state-owned metals conglomerate Chinalco does not intend to tale a stake in UC RUSAL when the indebted Russian aluminium company lists shares in Hong Kong later this year, the South China Morning Post reports. Last week a Russian newspaper had reported that Chinalco may be interested in acquiring a stake in RUSAL, citing unnamed banking sources.

Blackstone Group’s plan to buy Anheuser-Busch InBev’s U.S. theme parks for up to $2.7 billion may turn out to be a brilliant expansion into the recession-squelched entertainment industry. But it could also prove to be a roller coaster in terms of value if Americans don’t rediscover fun as part of the economic recovery.

For its part, AB InBev at least has a product that can sell equally well when people are depressed. The deal helps to satisfy its goal of raising $7 billion from divestments.

The theme park deal is one of the largest private equity transactions this year. It will add Busch Entertainment Corp’s 10 parks — including three SeaWorlds and two Busch Gardens — to Blackstone’s existing fun stable housing Madame Tussauds wax museums, Legoland and the London Eye Ferris wheel. mumblings about anti-trust issues, the private equity entertainment empire is active in a buyers market. Some say NBC Universal’s theme park could soon wind up on the block if GE sells content assets to Comcast.

Of the $2.3 billion Blackstone will pay up front, only $1 billion is equity. More than half of the deal is being financed through borrowing, which in and of itself may be reason for Blackstone CEO Stephen Schwarzman to scream with delight. Getting financing in these troubled times is no ride in the park.

There's an almost palpable sigh of relief in the statement from Blackstone and Lion Capital confirming the two private equity firms have received a "binding offer" from Japan's Suntory for Orangina Schweppes.

It discloses little beyond Blackstone and Lion saying they will only be able to decide whether to accept the offer "once the necessary social, legal and
regulatory steps will have been completed".

All that of course involves lots of red tape -- so it may take some time -- but you can be sure Blackstone and Lion will be doing everything they can to speed the process along -- wishing the days away and hoping that their luck holds.

Finding a buyer like Suntory apparently willing to pay somewhere between $2.6 and $3 billion for Orangina at this point in the cycle gives Blackstone and Lion the perfect exit. Suntory could be paying them up to twice 2008 sales and more than they paid in 2006 to get hold of Orangina and its European brands.

The duo crow that since they took over in 2006, Orangina has "achieved industry-leading growth, both organically in its core countries and by expansion into new markets, and through strategic acquisitions of leading brands". Volumes and sales have both risen and Orangina Schweppes is now the second largest producer in Europe's still soft drinks market.

Blackstone's chief operating officer Tony James said last week that the private equity group would look to get out of investments if there was an opportunity for long-term value and noted that flotations are once again a possibility.

That begs the question why Blackstone -- with $28 billion in its coffers to invest -- and Lion have decided to go with Suntory rather than an IPO for Orangina.

The answer may well be in some of James' other comments on the prospects for the economy. He expects a few quarters of stronger earnings as inventory is rebuilt, but sees the recovery as "grudging and slow".

Unlike Suntory's binding offer, there's nothing certain at this point about how European consumer spending will develop. No wonder the private equity partners are happy to bid farewell to their soft drinks empire. It could easily turn out to be flatter than Suntory is hoping.

Orangina may change hands as Suntory Holdings is talking to the soft drinks maker’s current owners, Blackstone and Lion Capital. Suntory meanwhile is in talks itself to be sold to Kirin Holdings, its bigger rival.  

And Britain’s transport group National Express is ready to accept the 765 million pound bid offer from private equity house CVC and the Cosmen family, the Daily Telegraph says.

For these and other Reuters stories on deals, click here. Plus top stories in other media (some links may require subscription):

* U.S. private equity firm Blackstone is in talks to buy a 63 percent stake in Indian agro-chemicals and veterinary drugs maker Gharda Chemicals for about 6.3 billion rupees ($130 million), the Economic Times says.

* Japan’s Daiwa Securities Group (8601.T) and Sumitomo Mitsui Financial Group (8316.T) are set to announce the end of their investment banking joint venture on Thursday, according to the Kyodo news agency.

* British airline bmi, owned by German flag carrier Deutsche Lufthansa (LHAG.DE), has so far attracted interest from 12 potential buyers, a German newspaper says.

* Mercedes has agreed to take a 75 percent stake in Formula One leaders Brawn GP within the next three years, German magazine Auto, Motor and Sport reports.

Bond sales are at a record, equity markets are at year-highs, private equity firms are sitting on huge cash piles -- Blackstone alone has $29 billion -- and banks are lending to each other again.

The ingredients should all be there for a resurgence of cash-driven mergers and acquisitions. But instead, the market is in hibernation.

So far the value of all M&A deals completed this year totals $990 billion. You have to go back to 2003 -- when the total for the year was $1.23 trillion -- to find a figure this low, according to Thomson Reuters data.

Of this, some $364 billion -- just 37 percent -- were cash deals, marking a dramatic shift in the mix of recent years when cash has dominated.

The main spanner in the works is the still dire state of banks' balance sheets and the crippled syndicated loan market. This has kept a tight lid on cash bids of any size, with the mega merger or takeover a distant memory.

Most banks are doing all they can to shrink their balance sheets, guard against problem exposures and to lend to their best clients. As a result, global syndicated loan volumes hit their lowest monthly volume since 1993 in July.

True, corporate bond issuance is booming and companies are raising equity, but this is not going to be enough to fill the void. And even if companies are confident of being able to fund their purchases with bonds, they first need to find a bank to give them a bridge loan.

The absence of debt finance has all but killed off fully-funded hostile cash bids. One consequence has been a shift to the type of bear hug Xstrata is attempting on Anglo American, where a attempts to win shareholder support for a deal before launching an offer.

Meanwhile, other companies are assembling warchests to give them the opportunity to move quickly when they spot a bargain. German chip-maker Infineon, for instance, recently raised equity to repay borrowings and prepare a stash of dry powder for acquisitions.

Another approach is to raise equity by partially listing subsidiaries. Spanish bank Santander is seeking to float part of its Brazilian unit and British insurer Aviva is doing the same with its Dutch operation, Delta Lloyd. Not only does this raise some fresh capital to bolster the parent's position, but gives the unit concerned an acquisition currency without drawing on its cash-strapped parent.

An alternative is to buddy up with a cash-rich financial investor. Germany's Bertelsmann, for example, teamed up with KKR to form a music rights management company designed to prey on distressed competitors.

One area where buyers don't always have to put up that much cash for control is in distressed companies. In some cases, banks are willing to hand over the keys so long as the acquirer is willing to inject some more cash into the company to put in on a stable footing. One example is the acquisition of Pearl by special purpose acquisition company Liberty International, where Liberty put in fresh cash, and the banks wrote down some of their debt.

Vulture investing isn't going to spur much of a recovery in overall volumes, however. That's probably a good thing. A great deal of the hyperactive M&A of recent years was wasteful and left businesses saddled with too much debt. Moreover, many businesses are more concerned about bolstering their balance sheets and steering a steady course through the recession rather than empire-building.

There remains another problem with distressed M&A: the relative shortage of targets. Banks have been reluctant to get too tough with troubled borrowers for fear of realising further losses -- so rather than foreclose they have often been prepared to amend debt terms and relax covenants. This has allowed many to ride out the storm so far. And for less distressed sellers, market volatility has made it harder to agree on value.

Like the banks, CEOs are being equally cautious about what they do with their cash. Those who have survived the financial crisis aren't about to be caught napping a second time. They may be tempted into share offers to grab assets they think worth acquiring if they see greater market and economic stability returning, but most will be keeping their cheque books deep in their inside pockets for now.

-- By Neil Unmack and Alexander Smith

KKR’s next buyout fund will be a 2010 event, sources told us and peHUB – unless the market collapses again… While KKR hasn’t committed to a timeline or even started raising the fund (no documents are out), there had been an expectation it would start raising in 2009. (Private equity research group Preqin published this table in June (flip to page 13) of the funds they’re following as “on the road”. )   

However, KKR still has a sizeable chunk of its existing funds to spend (known as dry powder) – it finished raising a $17.6 billion to spend on buyouts in 2008.

Fundraising is a tough place to be right now. Blackstone is continuing to chip away raising for BCP VI, its sixth buyout fund, which according to Preqin has a $15 billion target.

Other research Preqin has done shows the average time taken to close a fund is 18.3 months. That’s not surprising, as LPs (the investors in private equity funds) are far more concerned that private equity funds don’t make capital calls on existing funds.

But some are managing to raise even first funds  – Huntsman Gay finished raising its first fund, totaling $1.1 billion this week.

Rob “Big Loan” Verrone was the banker with the big name behind the 2007 acquisition of now-bankrupt Extended Stay.

His nickname was trumpeted in the hotel chain’s 2007 press release detailing the deal — in retrospect perhaps not the best quality to shout about.

Big Loan, described as one of three who provided the mortgage and mezzanine financing, moved on from Wachovia according to a Wall Street Journal report last year, and we couldn’t immediately track him down for comment.

Extended Stay filed for bankruptcy today after being saddled with too much debt during the economic crisis.

The one party which did come out looking good was Blackstone, which sold out of the deal two years before it cratered.

The financial crisis appears to be creating some jobs for at least one group of people - former banking executives.

As private equity firms turn their attention to banks, they are seeking out retired chiefs and other senior executives with banking experience to lead their investments and run the banks they buy. 

Besides their operational experience, these executives bring to the table a crucial quality that can sometimes make or break a group’s bid to take over a bank - street cred with U.S. banking regulators.

Credible management for the banks they oversee is one of the key concerns of regulators, who worry about the health of the industry and separation of banking and commerce. It becomes all the more crucial in the case of private equity groups that don’t already own banks and so have no recent track record for regulators to rely on.

John Kanas, a veteran of the banking industry and former head of North Fork Bank, made such a comeback with a successful bid for Florida’s BankUnited.

Kanas leads the management team for BankUnited, which was bought by a consortium of private equity investors including WL Ross, Carlyle and Blackstone. He was tapped early last year by Ross to explore just such a possibility.

In another deal expected to be announced Thursday, Fortress Investment, Crestview Partners and Lightyear Capital plan to install Gene Taylor, a former Bank of America executive, as CEO after injecting $800 million into Florida’s First Southern, according to the Financial Times.

As the banking landscape is redrawn, it wouldn’t be a surprise then if other old faces end up in new roles before this crisis is over.

One intriguing remark that Blackstone COO Tony James let slip on today’s earnings call is that it could be gearing up to sell an energy asset. 
James explained that while opportunities to exit investments weren’t numerous, it had succeeded making a profit on the sale of pharmaceutical company Stiefel. 
“We have another company in our portfolio… in the energy sector, which had some very, very exciting results finding unbelievable amounts of hydrocarbons and… that might be something we’d look to exit,” James said on a call to the media. 
He didn’t identify the company so we’re doing the guessing ourselves — out of the current energy investments Blackstone lists on its website, we reckon Kosmos Energy, which has a significant oil field in Ghana, could fit the bill.

(Additional reporting by Mike Erman)