Research and Markets: New Publication Assesses Strengths, Weaknesses
PR Inside - www.researchandmarkets.com - Research and Markets ( www.researchandmarkets.com/reports/c84602 ) has announced the addition of ReAble Therapeutics Finance LLC Strategic Analysis Profile to their offering. — The ReAble Therapeutics Finance LLC

What’s the Matter With Citi?
BusinessWeek - Citi’s Japanese consumer finance business is having trouble, but the international bank’s main troubles are in the U.S. American consumers are having a tougher time meeting credit obligations, especially mortgages, causing loans on Citi’s balance

Court Charges Company With Contravention Of Income Tax Act
BruDirect - DMZ Construction Sdn Bhd was charged with failure to furnish the Ministry of Finance’s Revenue Section with the relevant returns of income and particulars forms that are required for the purpose of ascertaining the income tax

Former Alaska gov’s aide pleads guilty
MSN MoneyCentral - Not only were my violations of Alaska’s campaign finance laws wrong and unethical, they were stupid,” he said. Clark was flying to Anchorage early Tuesday and unavailable for an interview.

Iowa Civil Rights Commission closes Floyd County case
Globe Gazette - and to provide certain information as part of the registration or participation process. (We may ask, for example, for your name, email address, sex, age, and zip code, and we might request information on your interest in sports, personal finance

Goldman Fund Management Co-Head Kraus to Step Down (Update1)
Bloomberg - March 4 (Bloomberg) — Goldman Sachs Group Inc. investment management co-head Peter Kraus is leaving after his division’s Global Alpha hedge fund suffered a 40 percent drop last year. Kraus, 55, will step down at the end of the month and become a

Takefuji Loses $291 Million on Derivatives Deals (Update3)
Bloomberg - Fallout from the U.S. mortgage market collapse spread to the consumer finance industry for the first time after eroding earnings at the nation’s largest banks, brokerages and insurers.

Labor ‘cleans up Seasprite mess’
Australian Broadcasting Corp. - Tags: business-economics-and-finance , industry , defence-and-aerospace-industries , defence-and-national-security , defence-forces , navy , defence-industry , government-and-politics , federal-government , australia , nsw , newcastle-2300

The Other Imperialist
Egypt This day - Turkey remains a key NATO ally on the southeastern “front” of the alliance, yet signed deals with Russia on energy, finance and defense. Energy-wise, Turkey is already dependent on Russia for 70 percent of its natural gas.

Japan Capital Spending Falls 7.3%; GDP May Be Lowered (Update1)
Bloomberg - Capital spending excluding software fell 7.3 percent in the three months ended Dec. 31 from a year earlier, a third straight quarterly decline, the Ministry of Finance stated this day in Tokyo.

Share market plunges in fresh sell-off
News.com.au - But in trade today on the ASX, finance stocks have been some of the biggest losers in value, hurting mum and dad investors who piled their savings into bank stocks during recent years.

Housing in deepest decline since the Great Depression, economist states
Marketwatch - More and more of the country is now involved in the contraction, where six months ago it wasn’t as widespread,” stated Steve Kerch is assistant managing editor and personal finance editor of MarketWatch in Chicago.

Chancellor Alistair Darling to close loophole in finance deals based
Times On the internet - The Chancellor is expected next week to close a loophole in Sharia finance rules that have granted commercial property investors to avoid paying stamp duty on more than £1 billion of deals, The Times has learnt. Alistair Darling is expected to

Share This

Share This

Filed under: Cards, Ripoffs and Scams, Fraud

I first got interested in the issue of companies deciding not to honor gift cards following bankruptcy filings when Bradlees tried to pull that nonsense back in 2000. The company reversed that decision after universal consumer outrage but at the time a spokesman for Eliot Spitzer’s office stated the company was within its rights:”Everything goes to the bankruptcy court, and there’s a process in place for consumers to file a claim.”

Now consumers with Sharper Image gift cards are in a similar situation after the company announced that it was suspending the acceptance of gift cards but reassured consumers that “We appreciate your understanding…” I’m sure plenty of customers were less than understanding.

I don’t understand the logic behind this. Companies are not allowed to report a profit on the sale of a gift card until the it redeemed for merchandise. I would argue that the gift card money should be held in escrow for the consumers until the sale is made.

Gift cards are a great deal for businesses — they give the company cash to use/earn interest on before they’ve to provide anything of value in return. Consumers shouldn’t get the shaft when the company files for bankruptcy; they should get their money back before anyone else gets anything.

Share This

Share This

Filed under: Deals, Private equity industry, Investments, Activist investing

A private investment firm called Savanna Investment Management, LLC announced this morning that it has recently acquired $120 million in debt on seven office, residential and retail properties throughout Manhattan, Long Island and Connecticut. The real estate and development firm purchased these loans from four “major Wall Street banks” at discounts of what it said was up to 30 percent.

The press release even describes this as a vulture investing strategy. It described it as the firm’s opportunistic private equity investment strategy designed to take advantage of the credit crisis dislocation by acquiring subordinate bank notes. If that isn’t “a vulturing we go” strategy, then nothing else is either.

But there is even a more interesting theme here rather than a small $120 million piece. The firm is noting that there are literally hundreds of potential debt deals to pursue. Furthermore, it recently closed its “Savanna Real Estate Fund I” to investors and plans to acquire approximately $1 billion in new investment and development opportunities throughout the Middle Atlantic states and the Northeast with targets in office, residential, industrial, retail, land and development deals.

If there are “literally hundreds of opportunities” and the company recently shut on its fund, you can probably expect more vulture investing. There have been several other vulture cars that have come public or that have filed to come public. Just because people are investing doesn’t mean that a bottom has been set in stone. But at least the vultures are starting to circle.

Some people fault vultures, but someone has to do it.

Share This

Share This

Filed under: The Blackstone Group, KKR, Raising money, Texas Pacific Group, Apollo Management, Bain Capital, Private equity industry

With the severe credit crunch, the private equity world has come to a screeching halt. Sure, there is some dealmaking - but nothing like it was just a year ago.

So, what are the private equity folks doing? Well, they’re raising billions of dollars. This is according to a piece in the FT.com (subscription required).

Although, the typical investors in private equity funds, such as pension funds, are actually losing their appetites. There are concerns about lower returns as well as more massive concentrations of portfolio risk. Just look at the recent write-downs at KKR.

Yet, the top-tier private equity firms are still having tiny trouble raising money. TPG plans to snag $15 billion and Apollo should also get the same amount. And, as for Bain and Blackstone (NYSE: BX), it looks like they’ll get $20 billion apiece.

OK, so where is the huge money coming from? Yep, it’s the sovereign wealth funds. With bulging coffers - especially from oil - the money needs to go somewhere. And, with lower valuations and distressed companies, it could be spot-on timing for those with a long-term perspective.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar On the internet Guide to Decoding Financial Statements. He also operates DealProfiles.com.

Share This

Share This

Filed under: KKR, Private equity industry

KKR is the firm that pioneered the private equity business getting its start in the mid 1970s. Over the years, the firm has established 14 funds and generated average returns of 20% (net of fees).

Lately, though, KKR has come under attack (as have many other private equity operators). So, when the firm’s Private Equity Investors group, which is publicly traded in Amsterdam, had its conference call recently, Henry Kravis talked about the state of private equity.

It wasn’t an easy speak since the fund had to mark down the valuations of seven holdings. In fact, the return of the portfolio was a horrible -0.1% last year, and the fund is trading at a 38% discount to its net asset value.

Simply put, Kravis says that dealmakers will need to be creative. This means locating capital from substitute sources, such as private investors and hedge funds. There will also be more minority investments.

Kravis also stressed that KKR will continue to stick to its investment philosophy. This means focusing on companies that have stable revenues, diversified global platforms and room for operational improvement.

More importantly, Kravis stated that the private equity business is about the long-term. If anything, the best opportunities are when markets are in the midst of dislocations - which is certainly the case now.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar On the web Guide to Decoding Financial Statements. He also operates DealProfiles.com.

Share This

Share This