Free Republic

Obama raised most from private equity, hedge funds in 2008 By Jonathan Easley - 05/22/12 09:52 AM ET President Obama raised far more cash from hedge fund and private equity donors than any other candidate in the 2008 election cycle. According to an analysis by the nonprofit group Open Secrets, Obama took in nearly $3.5 million from large private-equity donors that year — nearly twice what his general-election rival, Sen. John McCain (R-Ariz.), pocketed. The data bring into focus the thin line Obama must walk in attacking presumptive GOP presidential nominee Mitt Romney’s background in the industry, which has sparked...

Campaign 2012: Newark's mayor succumbs to administration thought control after going off-script and praising the private-equity firm that succeeded in creating net jobs, unlike presidential investment Solyndra. The White House must have had a bad case of the vapors when Newark Mayor Cory Booker, viewed in some quarters as a practical, non-ideological problem-solver, praised the record of Mitt Romney's former private firm Bain Capital, before a national audience on NBC's "Meet The Press," and eschewed attacks of a type he found "nauseating." "I have to just say from a very personal level, I'm not about to sit here and indict...

When some of America’s biggest hedge fund and private equity firms started to sell ownership through initial public offerings a few years ago, many investors rushed to buy the stocks. The hedge fund and private equity industries had produced Wall Street’s biggest fortunes, billionaires like Stephen Schwarzman, David Rubenstein and Daniel Och. There are now some 50 hedge fund and private equity billionaires—it seemed to make sense for investors to want a piece of the companies that made them rich. But investing in hedge fund and private equity stocks has largely been a disaster for years. Blackstone’s 2007 IPO priced...

Gonna be having dinner with a Romney supporter this weekend. I know everything I need to know about "Bain Capital" and their way of skimming the cream off the top of failing companies, but I need all the information I can get.

The buy-out industry is under attack for destroying jobs. Its returns to investors are the real problem IF STEVE SCHWARZMAN thought it was valid in 2010 to compare Barack Obama’s “war” against business to Hitler’s invasion of Poland, what can he be thinking now? Private-equity executives must be hoping the boss of Blackstone will keep his opinions to himself. More bad publicity is the last thing the industry needs. Other Republican presidential candidates are competing to see who can say the most damning thing about Mitt Romney’s career at Bain Capital. Newt Gingrich’s supporters have even made a sort of...

Bain Capital is a classic “strip and flip” shop — a private equity firm that made its money buying businesses and sucking profit out of them by any means possible that often resulted in a stack of pink slips for everyday Americans. Romney “made fortunes by bankrupting five profitable businesses that ended up firing thousands of workers.” Here’s how it often went down. Romney’s Bain would buy a company and increase its short-term earnings through firing workers and shuttering plants in order to borrow enormous amounts of money. The borrowed money was used to pay Bain dividends, however, those businesses...

When Paul Simon sang “Mama don't take my Kodachrome” in 1973, he claimed he'd “read the writing on the wall,” but he couldn't have foreseen how a transformative technology — making photos from digits — would render obsolete his precious color film. The global brand icon that revolutionized photography, making it affordable and convenient for ordinary people, now teeters on the brink of bankruptcy. Unfortunately for Kodak workers and the residents of Rochester, N.Y., consumer choice — not Mama — vaporized Kodachrome. Because election season coincides with economic stagnation, lost jobs and defunct companies are political hot potatoes, putting capitalism...

On her radio show today, Laura Ingraham grilled Gov. Rick Perry about his criticism of Mitt Romney’s career as a “vulture capitalist” at Bain Capital. Especially unhelpful to Perry’s case against Romney was the fact that he received donations from private-equity firms in previous campaigns, as Ingraham pointed out. Here’s a partial transcript (the exchange occurs about 4:16 minutes in) and audio below. Ingraham: You know I am going to raise the issue of Texans for Public Justice. Their analysis of your campaign contributions since 2000 [indicates] you have received more than $7 million from private-equity firms and private investment...

I’m all in favor of piling on Mitt Romney for any number of reasons: his come lately embrace of hard right conservatism, his periodic malapropisms (“I like being able to fire people”) and above all, the nonchalance with which he displays a dazzling shortage of principles by incessantly flip-flopping on issues, sometimes the same day. But these latest salvos being fired at his service as the founder and head of Bain Capital go too far. Having spent nearly three decades on Wall Street, when it comes to Bain Capital, I feel equipped — some might say too equipped — to...

Although Former Speaker of the House Newt Gingrich has been in the news of late for attacking former Massachusetts Gov. Mitt Romney for his role at Bain Capital, it seems that Gingrich also had a paid role at a major private equity firm. From 1999 to 2001, Gingrich served on an advisory board for Forstmann Little, according to a New York Times report. Former Sen. Bob Dole and former Secretary of State Henry Kissenger also served Forstmann Little in similar capacities, a Gingrich campaign spokesperson told the Times. The Forstmann Little advisory board that Gingrich served on met twice a...

The private equity industry has what would seem to be an enviable problem. Despite a recent history of turning solid corporations into debt-laden cripples, leveraged buyout firms are sitting on $445 billion of committed capital. That's how much private equity has raised — but not yet spent — from investors like pension funds and endowments. Sounds like $445 billion is a good problem to have. But it's not that simple.

Michael Lewitt has an interesting new book out, called "The Death of Capital". In it, Lewitt attacks speculative investment activities such as private equity buyouts. He notes that such speculation "has been a prime abuser of capital as it has diverted an inordinate amount of capital into unproductive uses while producing (at best) mediocre returns and charging unjustifiably exorbitant fees." He also cites naked credit default swaps, leveraged buyouts and quantitative stock trading strategies as cases where capital has been channeled into unproductive use. Surveying the base metals this week, his point is driven home. The aluminum price ticked up...

NEW YORK (Dow Jones)--A grant program introduced in the federal stimulus package passed earlier this year was intended to jump-start investment in renewable energy, but the rules of the program threaten to hobble it from the start by restricting private equity involvement in any projects the government backs. The rules, published July 9, exclude from the program any projects with investors that have tax-exempt status. That was done because the grant program is intended to replace tax credits, which have become less widely used as taxable incomes have fallen.... However, most private equity firms receive backing from tax-exempt limited partners...

I have a theory that if you took all the money in the world and divided it equally among all the people's of the world, it would end up in the same pockets as it left 5-10 years from now. The rule here is that money goes where it can earn it's highest return and be guaranteed to return. That clearly isn't Wall Street. The sub prime stuff made the underwriters and issuers a fortune and the investors nothing. Investors like pension funds and super wealthy individuals have been there and done that and my sense is they are not...

Excerpt - The two proposed buyers of Clear Channel Communications filed two lawsuits on Wednesday against six banks that agreed to finance the company’s $19.5 billion buyout. Bain Capital and Thomas H. Lee Partners, two private equity firms, sued the bank consortium in New York state court for breach of contract, accusing them of refusing to honor their commitment to finance the deal. Additionally, the two firms and Clear Channel itself sued the banks in Bexar County, Texas, where the broadcaster is based, accusing the banks of interfering with the closing of the takeover. ~ snip ~

SH 130 Concession Company LLC finalized the legal details of a financial close with Texas DOT on a $1,360m toll concession to build SH130 segments 5&6 Thursday and Friday last week in bankers' offices in New York City - at Orrick, 666 Fifth Avenue. The actual money flows should occur on Thursday or Friday (Mar 13 or 14) this week, Jose Maria Lopez de Fuentes, president of Cintra North America, told us this morning. Hundreds of documents and over 20 lawyers were involved last week representing TxDOT, private equity people, banks, mostly European, the TIFIA loan group from FHWA, and...

AUSTIN – State Transportation Commission Chairman Ric Williamson is proud that he can still work a bulldozer, a skill he learned early on the ranch and in the gas fields. Others would say he still drives it at meetings, committee hearings and town hall gatherings. Mr. Williamson, 55, is one of the most influential men in Texas. He has the ear of the governor, with whom he speaks almost daily. He is the architect behind the state's road plan for the next 25 years. He is smart, studious, self-made. And critics, who seem as endless as a West Texas highway,...

Private equity deals getting riskier: lenders Jill Treanor in London June 7, 2007 ALARM bells have been sounded by two lenders about the way loans were being handed out to fund the booming private equity sector. Royal Bank of Scotland, in the throes of a record-breaking takeover of the Dutch bank ABN Amro, admitted there were signs the market was getting "quite toppish", while Intermediate Capital warned it was turning away deals because they were too risky. Riskier loans are being granted because banks are able to offload their exposure to rivals by forming large syndicates. Debt is a crucial...

Alltel to Be Acquired by TPG Capital and GS Capital Partners for $71.50 Per Share Alltel Corp. (NYSE: AT) today announced that it has signed a definitive merger agreement to be acquired by TPG Capital and GS Capital Partners ("GSCP”), in a transaction valued at approximately $27.5 billion. Under the terms of the merger agreement, TPG Capital and GSCP will acquire all of the outstanding common stock of Alltel for $71.50 per share in cash. The purchase price per share represents a 23% premium over Alltel’s closing share price prior to media reports of a potential transaction published on...

Temasek Holdings, the investment arm of the Singapore government, is offering of up to $1.6 billion for local packaging house STATS ChipPAC—a bid that analysts said may undervalue the once-troubled firm. Temasek subsidiary Singapore Technology Semiconductors said Thursday it would pay $1.14 per share for the 64.4 percent of STATS ChipPAC that it doesn't already own, rising to $1.23 per share if its final stake exceeds 90 percent. The offer, which is conditional on Temasek obtaining at least half of the company, represents an 18.2 percent premium on its most recent share price. Though both parties are declining to comment...