Filed under: Banks, Ripoffs and Scams

ATMs are, imho, one of the great inventions of the last half century. Unfortunately, they’re also juicy targets for thieves, who have come up with some new tactics to bleed your account.

One rather sophisticated rig described on Snopes.com has two parts. One is a snap-on card reader that fits over the ATM machine’s real card reader. As your card is inserted into the ATM, it passes over the thief’s reader first, and the digital info on the mag stripe is captured. A pinhole camera mounted in the seemingly-innocuous deposit envelope holder records your PIN. With this info, the criminal can make himself a duplicate card and help himself to the your account.

Another even more elaborate scam was operated by a gang uses a real ATM. They obtained 50 real ATMs, arranged so that they could be used for real transactions, then installed them in stores and other public places on both coasts. When people used one of these ATMs, the crooks obtained their card info and PIN, which they then used to make duplicate cards for withdrawls of their own.

Fortunately, such elaborate measures are rare so far in the electronic age, but it would behoove you to look around before you make a withdrawl. If you spot any camera lens other than the ATM machine’s one, I’d drive away. I’d also grab the card reader and jiggle it a tiny to make sure it’s not a fake. I’d also be very reluctant to use any ATM other than my bank’s. Better to be cautious than sorry!

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Filed under: The Carlyle Group, Private equity industry

It’s hard to believe, but the credit crunch is getting close to a year old. When it first hit, the result was stunning as pending deals came under much pressure, such as with price renegotiations, litigation and abandonments. There was also an evaporation of mega deals.

However, lately there are signs that buyouts are making a comeback. A current example is Carlyle’s $2.54 buy of the government business of Booz Allen Hamilton.

But that’s not enough to support the heavy dealmaking infrastructure on Wall Street. As a result, we’re now seeing some major layoffs as well as the departures of key players.

For example, according to a piece in Bloomberg.com, the co-head of leveraged finance at Morgan Stanley (NYSE: MS), Ashok Nayyar, has left the firm. And the global leveraged finance chief at Deutsche Bank AG, Michael Paasche, is also leaving.

Of course, this doesn’t mean that leveraged finance will go away. If anything, major private equity firms will likely bolster their own platforms. Or, we might see other banks entry the fray, such as Barclays Capital (NYSE: BCS).

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 MergerBook.com.

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Filed under: International markets, Deals, Good news, Middle East, Next big thing, Entrepreneurs, Headline news, Israel

A story yesterday in Business Week, A Mideast Valley of Peace discussed how the development of a $3 billion canal from the Red Sea to the Dead Sea is gaining some traction. There’s both Arab and Israeli support for the idea which would bring industry, tourism, and most importantly water through desalination plants to a very thirsty location.

According to the report the ambitious project is being energized by 60-year-old billionaire Itzhak Tshuva, who was born into a poor family of 11 who crammed into a single room after immigrating to Israel from Libya in the 1940s. He went on to build a global real estate empire that includes New York’s Plaza Hotel, as well as a recently announced $8 billion luxury hotel, retail, residential, and casino complex on the Las Vegas Strip.

Equally important, the project is getting a warm reception in parts of the Arab world. This so-called Valley of Peace is part of a 520-kilometer (323-mile) corridor being proposed by Israeli President Shimon Peres for regional economic development. Peres says he has received letters of support from both Palestinian President Mahmoud Abbas and Jordan’s King Abdullah II. And according to Israeli press reports, Saudi Prince Alwaleed bin Talal — known for his investments in Western icons such as Apple (NASDAQ: AAPL) — recently told Tshuva that he’ll support the project through Jordan.

Nothing is mentioned about Hamas in the story, but the scope and scale of the project would offer economic opportunity and even prosperity to those that have found it hard to come by, so promoters while not naive, are hopeful.

Among the Israeli industrialists who support the project is Stef Wertheimer, founder of Iscar Metalworking, which sold 80% of its shares to Warren Buffett’s Berkshire Hathaway (NYSE: BRK.A).

Since a major purpose of the project involves water and power I could imagine companies like General Electric (NYSE: GE) and privately held Bechtel becoming involved.

It is envisioned that the project would be “green” and in that vein, environmental studies are under way to determine the repercussions of mixing water from the two sources and other issues. Currently the potash industry, which generates billions of dollars of revenue for Israel and Jordan at the Dead Sea, is also a factor receiving attention.

Nothing seems to move very fast when so many celebrations are involved. However, Perez said that the project could be built in as tiny as two years once it was concurred to do it.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I own shares of BRK.B.

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Filed under: Deals, Top deals, Rumors, Financials and analyticals, Private equity industry, Public or private?

BCE, Inc. (NYSE: BCE) is one of the large multi-billion dollar pending mergers that is on hold and is caught in the middle of a fight. Its merger has been on the books for nearly a year and its ultimate fate is not know.

But because of all the speculation in this with a defined legal fight currently underway, and combined with the post Clear Channel Communications (NYSE: CCU) merger terms having changed, this one is uncertain. But….

We’ve seen a leveraged trading in the stock options activity today that threw up a big giant red flag. There were more than 20,000 options contracts that have traded today that looks like a straddle play in the June options.

You can read the full story at Volume Spike (VSinvestor.com) to see in-depth options analysis, where we think this stock has to go, and more detailed data on the BCE, Inc. legal fight.

Jon C. Ogg

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Filed under: Ripoffs and Scams, Technology

Microsoft is beginning to build buzz in long term preparation for yet another version of Windows, at the moment known as Windows 7. Speculation has the company putting this on the market late next year or early 2010.

I began using computers in the 1960’s, and would have laughed in your face if you had told me that forty years later they would still be so complex and unharmonized that even a relatively savvy user would have to spend hours each week just nudging commands to get it to work. Therefore, excuse me if I seethe a bit about having yet another OS shoved down my throat.

I’ve been using Vista lately because I’ve to; XP won’t be supported forever. I’ve a license for MS Office 2003, which does everything I need these programs to do, just fine. Under Vista, though, these formerly dependable programs crap out regularly. Do I suspect Microsoft is OK with this, as it provides incentive for me to buy newer versions of the programs? Of course I do.

I don’t want a new Windows. I want a personal that runs the software I use without reverting to the blue screen of death each day. I want a computer in which I don’t need to know how to access the msconfig file or configure my wireless network or reboot in safe mode and check my error log.

If Microsoft sold cars, do you suppose I’d need to cease and reboot my ignition system daily? Would I’ve to know how to set a timing sequence? Would I need to know which controls to press, in which order, to get the windows to roll down?

I think Microsoft has made enough money that it should spend some to make computers work better, rather than worse. They seem to be the software equivalent to the windshield replacement company owner who goes out at night with his BB gun to shoot out windows. Anything to keep suckers coming back, over and over again.

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Filed under: Extracurriculars, Food, Ripoffs and Scams, Fraud

Have you heard this joke:

Waiter, there’s a fly in my soup!
Don’t worry sir, the spider on the breadroll will get him!

How about this one:

Waiter, there’s a fly in my soup!
Force of habit, sir. Our chef used to be a tailor.

Or maybe this one:

Waiter, why is there a bee in my soup?
Sorry, sir. It’s the fly’s day off.

When I was a kid, I used to be a massive fan of cheesy jokes (I grew out of the tendency sometime last week, even though I acknowledge that a relapse is possible). I collected all sorts of bad puns, double-entendres, and borsht-belt groaners. I knew dozens of knock-knocks, Tom Swifties, and, yes, fly jokes. Yet, for all the jokes I remember, here’s one that I never heard:

Judge, judge, there are two flies in my bottled water!
Yes sir, now here’s your $343,000.

You don’t think it’s funny? Neither did Canada’s Supreme Court, which recently overturned the ruling of a lower court in the case of Waddah Mustapha versus Culligan of Canada. Apparently, Mr. Mustapha found two flies in a bottle of Culligan water, which, he claims, caused a large bout of vomiting, followed by a massive phobia involving water. Mr. Mustapha further claimed that he was no longer able to shower or have sex, and was plagued by visions of flies swirling around piles of feces.

How does that work out to $343,000? Did the jury pick the number based on $171,500 per fly? Maybe they went with $28,583.33 per leg or $85,750 per wing. Or maybe it’s lost wages, even though one wonders how Mr. Mustapha’s capability to shower and have sex would affect his work performance. Clearly, this would be a real problem if he was a plumber or a gigolo.

Now, I’ve had enough post-traumatic stress disorder to recognize that it’s a real phenomenon. That having been stated, if the sight of two flies is enough to completely undermine your entire life, then maybe the problem isn’t the flies. As one site noted, Canada assumes a “reasonable fortitude and robustness of its citizens and won’t impose liability for the exceptional frailty of certain individuals.” This stands in stark contrast to the American model, in which extensive pretrial discovery would probably have determined that Mustapha was, indeed, nuts. He would undoubtedly have ended up with a large award, had Culligan not simply decided to settle out of court. The court costs would, of course, have gotten added into the price of all of Culligan’s products.

Sometimes Canada starts to look really, really good.

Bruce Watson is a freelance writer, blogger, and all-around cheapskate. He wonders if there is a legal way of saying “Man up and stop whining.” Maybe reversing a $343,000 ruling does it.

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Filed under: Bargains, Extracurriculars, Ripoffs and Scams, Shopping, Transportation

When I was a kid, my buddy Sean had a large collection of 1970’s-era MAD magazines. I remember flipping through them, laughing at the Star Wars and Jaws jokes, and being totally puzzled by the gas crisis humor. After all, this was the mid-1980’s. Gas was cheap, vehicles were efficient (relative to the 1970’s, at least), and the idea of siphoning gas was bizarre. For the life of me, I couldn’t comprehend why someone would want to spend good money on a locking gas cap, much less suck fuel through a tube.

Flash-forward twenty years or so, and I’m starting to comprehend all the jokes. Recently, my wife and I calculated that, given current gas prices, it would cost us over $80 to fill up the Jeep Liberty that we used to own. With that in mind, it’s hardly surprising that there’s been a rash of gas thefts. Earlier this month, the New York Police department ordered 400 locking gas caps, as there’s been a high rate of gas siphoning. According to a recent report , a Lambertville, Michigan Sheriff’s deputy was staking out a neighborhood to protect against an arsonist when the suspect actually tried to siphon gas from the deputy’s cruiser!

Want to see how simple it is? Check out Tom Barlow’s earlier post. In fact, as Josh Smith recently pointed out, some thieves are even stealing waste vegetable oil, as it is capable of powering diesel engines!

All of this rampant gas theft has fueled something else: locking gas caps, which used to be nearly a historical curiosity, are back in style. Stant, Inc., America’s largest manufacturer of locking gas caps, has seen demand go through the roof, as has Amazon.com and numerous retailers. This is hardly surprising; at $15-20 a pop, locking gas caps are an economical way to protect what might be the most valuable thing in your automobile!

Bruce Watson is a freelance writer, blogger, and all-around cheapskate. He protects his gasoline by leaving it with all the other gasoline at the gas station.

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Filed under: Rumors, Private equity industry, Value and lack thereof

24/7 WallSt.com has come up with a list of 11 targets that could fall under foreign ownership. These deals should become easier and easier for foreign entities or sovereign wealth funds if the extreme weakness in the dollar continues. However, the dollar’s slide may be disturbed, as our interest rate futures are calling for more than a 100-basis point rise.

Our country and our companies have increasingly become targets for foreigners buying assets on the cheap. The trick is determining which ones have no impact on US national security so that the Committee on Foreign Investment in the United Says and other watchdogs don’t file to block the merger.

Major U.S. companies failed to move aggressively after the Asian Contagion in 1998, which was their last chance to buy foreign properties at a discount. Now that The US Dollar has become the US Peso, it seems that the U.S. could see many US-based companies become foreign acquisition targets.

This may be the post-American cycle taking effect or the flattening out of the world. Whatever it ends up being, it isn’t going to be without controversy and without change. You can read the full story from 247WallSt.com to see the list of eleven possible deals of public US companies as well as a list of eleven other current US brands that are now foreign-owned.

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Filed under: Raising money, Private equity industry

Prospect Capital Corporation (NASDAQ: PSEC) has announced it will raise funds in a public offering of three million shares of common stock, and Prospect will allow the underwriters a 30-day option to buy up to an additional 450,000 shares of its common stock to cover over-allotments from underwriters.

The private equity and mezzanine finance company stated that it expects to use the net proceeds from this secondary offering to repay outstanding debt, to fund investments in portfolio companies, and for general corporate purposes.

Citi and Wachovia are the lead underwriters, and Oppenheimer, and RBC Capital Markets are listed the co-managers of this offering.

Continue reading at 247WallSt.com to hear about the implications and how this compares to the overall size of the company.

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Filed under: Deals, Movers and shakers, The Blackstone Group, Rumors, Apollo Management, Private equity industry, Public or private?

Shares of Chemtura Corporation (NYSE: CEM) are seeing some love early Tuesday. A report out of the WSJ from last night is putting the stock in play as a potential takeover target. The report notes that Blackstone Group LP (NYSE: BX) and Apollo Management LP are in speaks to acquire the specialty chemical maker.

The company’s market cap is nearly $1.9 billion, so it would seem within the realm of deal sizes even in an environment where private equity types have not been able to do many deals. Whether or not the deal is made, that’s yet to be seen.

Chemtura products are used in flame retardants, polymer additives, PVC additives, agriculture, plastics, and more.

Even on a deal this size, do we need club deals in a private equity environment in need of simplification? Either way, until we’ve an announcement. this should be treated as just a rumor.

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