The US union, the Service Employees International Union, today launched its “global day of action” against the private equity industry with demonstrations in 25 countries and across 20 states in the US.
The SEIU represents 1.5 million public service workers, nurses, hospital staff, nursing home care providers, building services and security guards in North America. The union and its president, Andy Stern, have repeatedly protested against the buyout industry, historically targeting The Carlyle Group and currently focussing on Kohlberg Kravis Roberts.
The targets of the protests are largely KKR offices and portfolio companies including Toys R Us, Jazz Pharmaceuticals and food manufacturing company US Foodservice. Employees at three Toys R Us locations scheduled for demonstrations told PEO there were no protesters at the stores this morning.
Several hundred protesters gathered at demonstrations in front of KKR headquarters in both New York and Menlo Park, California.
SEIU: Protesting big buyouts
Last month, the SEIU said in a statement that KKR’s “risky debt-laden deals have contributed to the credit crunch and helped throw the economy into free fall”.
However KKR dismissed SEIU’s attack today saying in a statement: “We disagree with the SEIU's distortion of the facts and their street theater approach. We work hard to build better companies that benefit multiple stakeholders – including the millions of pension beneficiaries who receive good returns on our investments. The reality is that we are committed to creating jobs and strengthening companies, communities, corporate governance and the environment.”
Also being targeted were public pension funds, the California Public Employees' Retirement System (CalPERS), Los Angeles Area Pension Funds and New York Commons Pension. The SEIU recently attempted to push a bill through the California legislature that would have prevented that state's pensions from investing with private equity firms linked to certain sovereign wealth funds.
In the political arena, Oregon Senator Gordon Smith was expected to be a target for protests in five locations throughout the state in opposition to the “tax loophole” which treats carried interest as a capital gain. Republican presidential hopeful John McCain’s Virginia headquarters was also due to be targeted following the candidate’s receipt of campaign contributions from KKR co-founder Henry Kravis as well as other private equity executives.
The UK’s largest trade union, Unite, has publicly declared its support for the SEIU. The union stated it was establishing a programme to examine how pension fund managers were investing retirement savings and were today backing calls for MPs in the House of Commons to debate tougher statutory regulation of private equity as part of the SEIU’s “global day of action”.
According to Unite, KKR has been responsible for the loss of nearly 10,000 jobs in Europe over the past seven years. KKR said in the statement, the buyout firm had increased employment by 505 percent at electric transmission company ITC, 22 percent at Toys R Us and 13 percent at battery company Duracell.