Private Equity
At least, you can make the argument, according to the U.S. Securities and Exchange Commission. Take the practice by buyout shops of securing bridge financing from banks on new deals as a temporary measure until permanent financing can be put in place. “When market conditions suddenly turn, these can be left holding this potentially risky bridge financing (or committed to provide the final bank financing, but no longer able to syndicate or securitize it and thus forced to hold it) at precisely the time when credit market conditions…have worsened,” the SEC writes in a proposal published late last month to require registered buyout shops and hedge funds to regularly fill out so-called Form PFs. The forms would be used by the newly-created Financial Stability Oversight Council to monitor risks to the U.S. financial markets.
3 min read · 23 February 2011
Bain Capital, one of the original members of the Private Equity Growth Capital Council, has not renewed its membership for 2011, the council confirmed for peHub. The firm no longer appears on the member list on the PEGCC website. The departure marks a blow to the annual revenue stream of the council, which has been active of late in Washington D.C. in fights against raising taxes on carried interest and in improving the industry’s image. However, membership has also been growing since the council opened its doors to smaller buyout shops early last year, mitigating the loss. Neither Bain Capital nor the council would comment on the annual dues that the firm has paid (nor would executives at Bain Capital comment on anything related to this story). However, that Bain Capital and its affiliates have an estimated $65 billion under management suggests the firm was paying as much as $750,000 per year, based on information supplied by PEGCC to sister magazine Buyouts in early 2010—see dues levels below.
2 min read · 18 February 2011
3 min read · 09 February 2011
President Barack Obama last month ordered federal agencies to review business rules already on the books with an eye toward eliminating “outdated regulations that stifle job creation and make our economy less competitive,” according to his recent opinion piece in the Wall Street Journal. This will surely lead to some good. But given the lengthening roll of red tape facing financial sponsors (headlined by requirement to register as investment advisers), it must have been tough for them not to stifle a sarcastic chuckle. Indeed, in a relatively little noted action last summer, the Federal Trade Commission proposed changes to its Hart-Scott-Rodino pre-merger notification rules to give it more information upfront about buyouts and other M&A deals to determine if they raise antitrust concerns.
4 min read · 01 February 2011
3 min read · 31 December 2010
Prognosticators and pundits are hurling every prediction and possibility on topics ranging from the economy to professional sports to the Academy Awards for 2011, so we here at peHub thought we’d weigh in with a few of our own. Just don’t bet the farm on these ones to come to fruition. “Chooch 2—North To Alaska” becomes a surprise Memorial Day hit, more than earning enough money to pay off all of investor Steven Rattner’s fines. Google will give two more companies instant, overnight desirability and massive fundraising clout by being rejected as a bidder. Again. Warren Buffett gets caught skinny-dipping on the Jersey Shore, disproving his saying that it’s only when the tide goes out that you know who’s not wearing a bathing suit.
2 min read · 30 December 2010
3 min read · 29 December 2010
2 min read · 27 December 2010
Nearly half of business executives responding to a survey on Monday agree that New York's attorney general should go ahead with fraud charges against Ernst & Young. The Wall Street Journal on Monday reported that the accounting firm could face civil fraud charges in connection with its role in the 2008 collapse of investment bank Lehman Brothers. 498 executives from an array of industries participated in the survey, which was conducted by Argyle Executive Forum, a New York-based professional services firm. Fewer than a third of respondents (27.3 percent) say the New York attorney general shouldn't move ahead with charges, and another quarter (24.3 percent) say they aren't sure.
1 min read · 20 December 2010
The Washington State Investment Board has edged above its target allocation to private equity, with investments accounting for 25.3 percent of its $56.3 billion portfolio as of the end of September, according to sister publication Buyouts magazine. Its target allocation is 25 percent. The deep-pocketed state's PE holdings, which date back to 1981, were valued at an estimated $13.8 billion at the end of March, according to data on the investment board's Web site. The portfolio at that point consisted of interests in 245 funds to which the state state had committed an estimated $32.5 billion. Of that, PE firms had drawn down an estimated $27.6 billion and returned $24.5 billion. Older funds that appeared, as of March, to have drawn down quite a bit more than they've distributed include Frazier Healthcare IV ($40 million committed in or around 2001, $37.8 million drawn down, $13.2 million distributed), OVP Venture Partners VI ($40 million committed in or around 2001, $40 million drawn down, and $5.6 million distributed), and Green Equity Investors IV ($100 million committed in or around 2003, $107.4 million drawn down and $36.1 million distributed).
2 min read · 10 December 2010
