Filed under: Deals, Financials and analyticals, Private equity industry, Investments, Value and lack thereof, Public or private?

It was nearly amazing that private equity funds never did go acquire many banks or other depository institutions, despite the lending woes that came to pass. For some time there was value there before the logic and rationale behind credit evaluations were tossed out the window. We’d discussed this with many groups last year and the answer was always that the private equity firms were sitting out to avoid the relative valuation erosion as peer-pressure drove down the value of the solid companies.

Wilbur Ross may soon be making a change to this approach of avoiding the group. Last week there many reports out of Reuters, Crains, and others discussing Ross’s intent to go after depository institutions.

The past articles discussed and pondered different aspects that Ross and his new backers might pursue, but new information from this day might shed a bit more light on Ross intends to invest this money and how sovereign wealth funds may be involved in this.

Continue reading the full article at 24/7 Wall St.

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Filed under: Deals, Management, Raising money, Apax Partners, Bain Capital, Private equity industry, Investments, Value and lack thereof

An article by South-African based Business Report summarizes private equity trends this year amidst the crunched credit markets and slowing U.S. Economy. While it isn’t exactly 2007 or 2006, the numbers are still impressive.

According a Private Equity Intelligence Study cited in the article, in the first three months of 2008, private equity funds have raised $163.5 billion.

Last year, leveraged buyouts tripled the $73 billion posted in the same period this year. This article is also confirming what we’ve started seeing in many such private equity trends for the begin of 2008, as it notes that leveraged buyouts are being replaced with distressed debt. That is amounting to $40 billion being raised by 31 firms so far. For example, Bain Capital’s hefty $13.5 billion fund targets distressed debt, as well as venture and property.

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Filed under: Deals, Financials and analyticals, Private equity industry, Investments, Value and lack thereof, Public or private?

It was nearly breathtaking that private equity funds never did go acquire many banks or other depository institutions, despite the lending woes that came to pass. For some time there was value there before the logic and rationale behind credit evaluations were tossed out the window. We had discussed this with many groups last year and the answer was always that the private equity firms were sitting out to avoid the relative valuation erosion as peer-pressure drove down the value of the solid companies.

Wilbur Ross may soon be making a change to this approach of avoiding the group. Last week there many reports out of Reuters, Crains, and others discussing Ross’s intent to go after depository institutions.

The past articles discussed and pondered different aspects that Ross and his new backers might pursue, but new information from today might shed a bit more light on Ross intends to invest this money and how sovereign wealth funds might be involved in this.

Continue reading the full article at 24/7 Wall St.

Share This

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Filed under: Deals, Management, Raising money, Apax Partners, Bain Capital, Private equity industry, Investments, Value and lack thereof

An article by South-African based Business Report summarizes private equity trends this year amidst the crunched credit markets and slowing U.S. Economy. While it isn’t exactly 2007 or 2006, the numbers are still impressive.

According a Private Equity Intelligence Study cited in the article, in the first three months of 2008, private equity funds have raised $163.5 billion.

Last year, leveraged buyouts tripled the $73 billion posted in the same period this year. This article is also confirming what we have started seeing in many such private equity trends for the begin of 2008, as it notes that leveraged buyouts are being replaced with distressed debt. That’s amounting to $40 billion being raised by 31 firms so far. For example, Bain Capital’s hefty $13.5 billion fund targets distressed debt, as well as venture and property.

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Filed under: Management, Raising money, Venture capital industry, Private equity industry, Investments

IndexAtlas has announced the launch of the $50 million Art Industry Fund, an substitute private equity fund targeting only businesses that serve the art industry.

This will include such operations as auction houses, advisory services, financial and security firms, software and media companies. Each investment is intended to last four years and will range from $3 to $8 million. The fund is expected to shut by December 31, 2009.

CEO and founder of IndexAtlas, Sergey Skaterschikov, believes the fund will generate an IRR of 35% and bases his investing strategy on his book, “Skate’s Art Investment Handbook.” Skaterschikov established IndexAtlas in 2001 and manages $400 million in fully invested funds and has advised on $2.4 billion in transactions.

There have been many such reports in here showing how there has been a convergence of private equity and venture capital. If this isn’t a prime example of that, then nothing else is.

If I didn’t know better, it almost sounds a lot like a Sotheby’s (NYSE: BID) incubator fund, although it’s not.

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Filed under: Ripoffs and Scams, Shopping

It’s been a roller coaster ride for consumers trying to figure out what to do with their Sharper Image gift cards.

When the overpriced gadget chain filed for bankruptcy, it declared that it would no longer accept its own gift cards. Then it sort of relented, concurring to accept gift cards, provided that you bought an equal value of goods with cash. So if you had a $50 gift card, you would have to purchase another $50 worth of stuff in order to use it.

Then the California say attorney general’s office sought a temporary restraining order, seeking to block the company from requiring people to buy twice as much stuff in order to get what they’d paid for. But the Alameda County better court refused to hear the case, saying that it didn’t have jurisdiction because of Sharper Image’s bankruptcy filing.

Check out the Wall Street Journal article (subscription required) for the legal details. Those issues aside, it seems that the consumer protection laws in this area are seriously lacking. People don’t buy gift cards with the understanding that there’s a possibility they’ll be stiffed in the way that banks do when they lend money.

Public companies are not even granted to book a sale from a gift card until it’s redeemed for merchandise. Given that, gift card buys should be held in some kind of escrow account, and not released into the company’s general ledger until the sale has been completed. The gift card money should be separate from the rest of the assets involved in the bankruptcy.

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