Wednesday, February 29, 2012

From the T in GTCR

PEHub reported:

“Somewhere along the way, the PE industry lost its way,” he says. “Our industry is about moving capital and supporting companies so they can grow and create jobs. Nothing more, nothing less…Somewhere along the way it got to be about ‘private equity is about people getting rich.’”

“I didn’t get into this business to get rich,” (Carl) Thoma adds.

How much did Mr. Thoma make from selling LifeCare Hospitals to The Carlyle Group?  Weeks after GTCR liquefied its stakes in LifeCare, Hurricane Katrina struck.  Twenty five people died in the LifeCare unit at Memorial Medical Center.

A Toledo Sun reporter placed the blame on GTCR,. suggesting The Carlyle Group hadn't owned it long enough to be responsible for faulty disaster response.  Where were LifeCare's clinicians when Katrina struck, in or out of New Orleans?

Greed has long been a foundational feature of private equity underwriters (PEU's).  Failure to accept accountability is another.  Those two memes intersect in Thoma's remarks. 

Thoma downplayed his PEU's 45% return on investment, likely the reason for his latest PEU offering to overfill in five short months. 

Rubenstein's Tired Refrain


Carlyle Group co-founder David Rubenstein might have shouted this comment in Davos, Switzerland, years ago and the press just tuned into its echo.  This is his worn line:

"We need to do a better job of explaining what we do."
Rubenstein went on to say:

"No one wants to work in an industry that most people don't like," Rubenstein said, suggesting that only Congress and bankers enjoy less popularity than does private equity."

More people know about Congress and Banksters. Private equity underwriters (PEU's) are a new phenomenon for the mainstream press given Mitt Romney's time with Bain Capital. However, PEUReport chronicled private equity machinations over six years.


Rubenstein offered his remarks in a keynote speech at the SuperReturn International conference in Berlin.  Rubenstein enjoyed regular access to Congress and the White House.  President Obama just caved for PEU founders, like Rubenstein, to cash in their billions at a deeply discounted tax rate.

David Rubenstein will be one big draw in D.C. for the upcoming CES on The Hill event.  The Carlyle Group's Rubenstein is quite popular for a top dog in a hated industry.

Tuesday, February 28, 2012

Carlyle Does Double Monetization with Boston Private

American Banker reported:

Boston Private Financial Holdings Inc. put some of its excess capital to work by repurchasing 5.4 million warrants in a move that would eliminate potential dilution. The warrants were mostly held by private-equity firm Carlyle Group, Boston Private's largest shareholder
The warrant purchase gives Carlyle its first chunk of cash.  Here's the second:

Boston Private will sell "Davidson Trust Co. to Bryn Mawr Bank Corp. for $10.5 million."
How much of the sale proceeds will turn into a special dividend/distribution for Carlyle?  Recall Uncle Sam provided $153 million in TARP funding to Boston Private, a lender to high net worth individuals, during the financial implosion. 

PEU Banksters keep cashing in...

Sunday, February 26, 2012

Abu Dhabi to D.C.: For the Private Planeless

AMEInfo reported:

Etihad Airways announced the launch of non-stop daily flights to Washington, D.C., the airline's fourth destination in North America, from March 31 2013, subject to regulatory approvals.

The Washington region is home to America's second largest market flying to the Middle East, after New York. Etihad Airways' new service will link D.C. with Abu Dhabi, a vibrant and growing hub for business, culture and tourism.

James Hogan, Etihad Airways President and Chief Executive Officer, said: "No other UAE carrier is offering nonstop services between D.C. and the UAE, so this capital-to-capital link is a huge opportunity for Etihad Airways."
The article highlighted trade relations between the two countires:

The new service will further strengthen the already strong political and economic ties between the National Capital Region and the UAE. Last week, the US Department of Commerce released data showing that total trade volume between the US and the UAE rose to $18.3bn in 2011, a 43% increase from the year before.

This increase represents the highest trade volume to date between the US and UAE. It also means that, for the third consecutive year, the UAE is the single largest export market for US goods in the Middle East. The US is the fifth largest trade partner worldwide for the UAE.

How much of the increase was military related?  The UAE Embassy in D.C. reported:

The UAE has turned to the United States as a major defense supplier, to help ensure interoperability of forces. In 2009, the US Congress approved a UAE request to purchase more than $15 billion in US defense equipment. Included in this package is the world’s most sophisticated missile defense system, making the UAE the only country, other than the United States, to deploy this technology.

The UAE currently has a number of military equipment programs with the United States, including:

  • Patriot PAC-3 (Raytheon and Lockheed Martin)
  • HAWK Air Defense Missile System (Raytheon)
  • AH-64 Apache Longbow Helicopter (Boeing)
  • UAE Air Force Command and Control System (Northrop Grumman)
  • C-130 Cargo Aircraft (Lockheed Martin)
  • C-17 Aircraft (Boeing)
  • F-16 E/F Advanced Fighter Aircraft (Lockheed Martin)
  • Multiple weapon systems associated with F-16 E/F (Northrop Grumman, Raytheon)
  • UH-60 Blackhawk Helicopters (Sikorsky Aircraft)
  • High Mobility Artillery Rocket System (Lockheed Martin)
  • Maverick air-to-surface missiles (Raytheon)
  • In the pipeline: AVENGER, SLAMRAAM, Terminal High Altitude Area Defense missile system, known as THAAD.
President Dwight D. Eisenhower's Military Industrial Complex ballooned since his prescient warning.  It's now the Government Corporate Monstrosity, fueled by trillions in federal budget steroids.

Roid Rage means more wars. YNET reported:

Officials said that the Pentagon submitted a request to Congress on February 7 on behalf of Central Command seeking to reallocate $100 million in defense funding to "bridge near-term capability gaps" in the Persian Gulf.

US special-operations teams stationed in the United Arab Emirates would take part in any military action in the strait should Iran attempt to close it, defense officials told the WSJ
Etihad Airways expects players from the Government Corporate Monstrosity to buy seats:


12 Diamond First Class
28 Pearl Business Class
200 Coral Economy Class
Etihad knows who might fill their luxury seats:

In the Washington region alone, there are a number of organizations that have a strong business presence in the UAE, or deep relationships with UAE institutions. Among those companies are the Carlyle Group, Hilton International, Lockheed Martin and Children's National Medical Center. Respected local think tanks and policy organizations, such as the Brookings Institution and the US Institute of Peace, are also working closely with their counterparts in the UAE.

Carlyle co-founder David Rubenstein is known for his global travels, only he doesn't buy seats.  WSJ reported:

The Carlyle Group paid $4.75 million in 2010 for business-related flights made by David Rubenstein, the private-equity firm’s co-founder, according to Carlyle’s IPO documents.
WSJ added Rubentein's Gulfstream IV  is "registered to a Delaware letter-box firm, Rabbit Run LLC. Rubenstein has owned a home on Nantucket – on Rabbit Run Road."

Maybe Etihad can hire the UAE's Rabbit Control Systems LLC and get David Rubenstein in a Diamond First Class seat.

Saturday, February 25, 2012

Carlyle's Latest Bankruptcy: Medicaid Dental for Kids

The Tennessean reported:

A Nashville-based company that manages dental care centers in 22 states has filed for bankruptcy to restructure its debt and eventually attempt to sell its operations and assets.

Church Street Health Management LLC’s filing with the Middle Tennessee U.S. Bankruptcy Court this week listed roughly $85 million of assets and $300 million of liabilities.

How much goodwill did it take to get Church Street's sheet to balance?  Owners not only stretched the value of the company, they took liberties with kid's teeth and billing Uncle Sam.

That debt includes $150 million owed to its lenders and $17 million owed to several states and the U.S. Department of Justice under a settlement of charges that it billed Medicaid for unnecessary dental procedures for low-income children.
The settlement period runs from September 2006 to January 2010, all years under PEU ownership. Church Street's sins include:

(1) causing claims to be submitted by the Centers for reimbursement for performing pulpotomies that were not medically necessary and/or were performed in a manner that did not meet professionally-recognized standards of care

(2) causing claims to be submitted by the Centers for reimbursement for placing crowns that were not medically necessary and/or were performed in a manner that did not meet professionally-recognized standards of care

(3) causing claims to be submitted by the Centers for reimbursement for the administration of anesthesia (including, without limitation,nitrous oxide) that was not medically necessary, that was performed in a manner that did not meet professionally-recognized standards of care, and/or was administered by an unlicensed, non-certified, or otherwise unauthorized individual

(4) causing claims to be submitted by the Centers for reimbursement for extractions that were not medically necessary and/or were performed in a manner that did not meet professionally recognized standards of care

(5) causing the Centers to fail to obtain informed consent for certain dental procedures and services

(6) causing claims to be submitted by the Centers for reimbursement for fillings that were not medically necessary and/or were performed in a manner that did not meet professionally-recognized standards of care

(7) causing claims to be submitted by the Centers for reimbursement for sealants that were not medically necessary and/or were performed in a manner that did not meet professionally-recognized standards of care

(8)causing claims to be submitted by the Centers for reimbursement for radiographs (i.e., x-rays) that were not medically necessary, were taken in a manner that did not meet professionallyrecognized standards of care, and/or were taken by an unlicensed, non-certified, or otherwise unauthorized individual

(9) causing claims to be submitted by the Centers for reimbursement for behavior management techniques, including without limitation those techniques involving a papoose board, that were not medically necessary and/or were performed in a manner that did not meet professionally-recognized standards of care.
The above behavior resulted in a $24 million (plus interest) fine.  It seems Carlyle and Church Street are morally bankrupt as well as literally.

Did Church Street pay dividends or special distributions since The Carlyle Group invested in the company in September 2006?  If so, did PEU owners load Church Street with debt to fund payouts?

Medicaid considers management fees and capital cost reimbursable items on the acute side of health care.  Does it do the same for dental? 

How much did Carlyle, American Capital Strategies and Arcapita pull out of Church Street before it imploded?  Did any buy credit default swaps on Church's debt?  That could help ease the ache, but it would continue the morally bankrupt theme..

Private equity purports to be the savior of America's lopsided health care system.  Greed won't help, not in the least.

Update 1-29-13;  Senator Chuck Grassley lambasted Church Street, but gave their PEU owners a free pass.   Rubenstein et al oversaw an organization which traumatized children and bilked taxpayers 

Obama to Cover PEU Founders' Risk


FT reported on risks associated with The Carlyle Group's independent public offering:

Carlyle has to confront not only a sharply weaker business environment but a threat to the favourable tax treatment it has had.

A rise is in prospect in the US – from a preferential 15 per cent rate to being treated as ordinary income – and possibly in several European countries as well.

Carlyle has at least a two pronged strategy for ameliorating this risk.  The first is to prevent the rise or ensure it's watered down in such a way as to have no real impact.  This isn't difficult for power players inside the Government Corporate Monstrosity, Eisenhower's MIC on trillions in federal steroids.


Power Player and Carlyle co-founder David Rubenstein has direct access to Congress and the White House.  President Obama hosted Rubenstein six times in his first year in office.  Rubenstein loaned his copy of the Emancipation Proclamation to the Oval Office.



The second strategy is for the little people to pay.  

If this occurs, the (IPO) document suggests, the firm may increase the money it pays its executives to compensate for (their increased tax) bill and could also issue more equity. That means shareholders rather than the principals would pay the price and face dilution.

President Obama indicated he would accept a compromise, where private equity underwriters (PEU's) could cash in their stakes at the preferred rate  


It's Obama's PEU-liquefication Proclamation, which I expect David Rubenstein to preserve and frame.

Track the latest PEU arc in our PEU World.  Founders win emancipation from taxes.

Update 2-26-12:  Bloomberg noted Obama's move. Taxing carried interest like ordinary income never got through Congress, even when Democrats controlled the House of Representatives, Senate and White House, an exclamation point on our PEU World.

Friday, February 24, 2012

Carlyle's Rubenstein: Ain't No Steve Jobs


CES on the Hill will host a technology session for federal policymakers, members of Congress and the media.  CES will honor two Congressmen and honor Carlyle Group co-founder David Rubenstein for "his role in advancing technology." 

Advancing technology?  When BusinessWeek cited Rubenstein as a member of the Most Influential Fifty people, they wrote:

The secretary of state of private equity travels more than two-thirds of the year,raising new money. Rubenstein, 62, owns a copy of the Magna Carta that is more than 700 years old.

How does someone traveling more than two thirds of the year raising money advance technology?  Rubenstein is no Steve Jobs, who spent his life innovating technology.  Past winners of this award include Bill Gates and Michael Dell. FT reported:

The workaholic Mr Rubenstein denies saying that the happiest day of his life was the day he could send emails from the air.

Rubenstein's innovation pulls management fees and special dividends from Carlyle's tech investments.  It loads firms up with debt, because PEU's would rather pay interest than taxes.  It cut head count and the pension for Brintons, a recent acquisition, albeit not a tech company.

Why would CES on the HIll award a tech prize to David Rubenstein?  It's their technology field of dreams.  Invite Rubenstein and they will come.    "They" are members of the Government-Corporate Monstrosity, Eisenhower's MIC on trillions in federal steroids.  What will pandering to a Carlyle co-founder get CES on the Hill, besides attendees? 

Ironically, there's a different David Rubenstein, one at home in the high tech world.  That Rubenstein doesn't draw crowds like the PEU.

Carlyle's David Rubenstein, Secretary of our PEU State, I like that.

Update 3-13-12:  Rubenstein will get the Digital Patriot award. I wonder how many Carlyle affiliates rooted through citizens' digital information on behalf of Uncle Sam.  Start with Booz Allen Hamilton and follow the Carlyle trails.

Update 4-17-12:  The event begins next week.

Obama to Emancipate PEU Founder Stakes via Low Taxes


Bloomberg reported:

Private equity executives won a major concession in their battle with the Obama administration over plans to increase their taxes when selling stakes in their firms, potentially saving billionaires such as Stephen Schwarzman and David Rubenstein hundreds of millions of dollars.
The Carlyle Group is a virtual nonprofit, like a church or safety net hospital.  Private equity underwriters (PEU's) pay preferred taxes on profits from their investments.  President Obama agreed to not raise such taxes on carried interest when "buyout fund founders and other executives sell some or all of their holdings in their own firms."

President Obama long had populist talk and corporatist implementation.  Obama freed PEU billionaires to liquefy their stakes cheaply.  For Obama to cash in, like Bill Clinton and Tony Blair, PEU's must profit.  I find it ironic that Carlyle co-founder David Rubenstein has a copy of The Emancipation Proclamation on loan to the White House.  It once hung in the Oval Office.

How long before Obama signs the PEU-liquefication Proclamation?

Thursday, February 23, 2012

Carlyle to Re-monetize Qualicorps

The Carlyle Group invested in Brazilian health insurer Qualicorp in June 2010.  Carlyle, a 68% owner of Qaulicorp, hawked the deal in its press release:

Qualicorp will be well positioned to continue its strategy of enabling Brazil’s middle class to access high-quality private health insurance.

Less than a year later Qualicorp announced an independent public offering (IPO).  The IPO was expected to price between BRL 16 and BRL 19.  It went at BRL 13.

Qualicorp plummeted today to BRL 16 with the announcement that Carlyle would sell half of its remaining shares in a second public offering.  Early shareholders face dilution.
Carlyle uses Qualicorp's brass balls to raise cash.  Keep this in mind as America's health insurance system deforms.  Carlyle wants a stake in the Medicaid private insurer space.

Wednesday, February 22, 2012

CGI Brothers Clinton & Rubenstein at Ex-Im Bank Conference


President Bill Clinton and private equity underwriter (PEU) David Rubenstein will speak at the annual Export-Import Bank Annual Conference in April.  Clinton and Rubenstein frequent other gatherings of the wealthy and powerful.  Ironically, two share the initials CGI.

Bill Clinton - Clinton Global Initiative (CGI)
David Rubenstein - Carlyle Group Investors (CGI) annual meeting
President Bill Clinton helped Carlyle profit by privatizing the security investigation arm of the Office of Personnel Management in 1995.  This division became USIS, which turned into Altegrity.  Carlyle took its share of $1 billion in profit from their PEU exit.

Chelsea Clinton and David Rubenstein recently attended the World Economic Forum in Davos, Switzerland, where Rubenstein offered China's economic model as the panacea for America's financial ills.

The Export-Import Bank provided $32.7 billion in financing in 2011.   Carlyle knows how to tap the federal teat.  How many PEU affiliates got Ex-Im money last year?

Update 4-7-12:  This blast from the past shows how Clinton and Carlyle go way back.

Update 7-7-13:  CGI squared last fall.  This post ended up being predictive as Bill Clinton spoke at The Carlyle Group's Investor Meeting in September of 2012.   FT reported:

"Private equity groups compete with each other to host the most glitzy affairs and solicit the biggest names. Last September, Carlyle’s co-founder David Rubenstein led a question-and-answer session with Mr Clinton, who charges as much as $200,000, at its annual event."

Carlyle's Jumper to Head SAIC


Carlyle Group Senior Advisor John P. Jumper will become CEO of SAIC, a huge government contracting firm.  Jumper sat on SAIC's board since 2007 and will need only move a few chairs down to the CEO seat. Jumpers other board slots include

Goodrich Corporation
Jacobs Engineering Group Inc.
WESCO Aircraft Holdings, Inc.
NACCO Industries, Inc.
TechTeam Global, Inc.
Somanetics Corporation
SAIC

Here's what SAIC's 2011 SEC filing DEF 14A had to say about Jumper:

General Jumper retired from the United States Air Force in 2005 after nearly 40 years of service. From September 2001 to November 2005, General Jumper was the Chief of Staff of the United States Air Force, serving as the senior uniformed Air Force officer responsible for the organization, training and equipping of active-duty, guard, reserve and civilian forces serving in the United States and overseas. As a member of the Joint Chiefs of Staff, General Jumper functioned as a military advisor to the Secretary of Defense, National Security Council and the President.

The Board believes that General Jumper’s proven leadership ability and management skills, demonstrated by his service as the highest-ranking officer in the U.S. Air Force, and his expertise in defense and intelligence matters, make him highly qualified to serve as a director. General Jumper’s experience gives him a unique understanding of the needs of our largest customers. He is also an “audit committee financial expert” as defined in SEC rules.
SAIC waived the mandatory retirement age of 65 for Jumper.  It also hired a CEO without a definitive salary and compensation package. 

John Jumper also has Jumper Associates, a position from which he served as a member of the HARVARD UNIVERSITY EXECUTIVE SESSION ON UNMANNED AND ROBOTIC WARFARE:  Issues, Options, And Futures.

Jumper continued the "unmanned and robotic warfare" theme in conjunction with another Carlyle affiliate, Booz Allen Hamilton.   He penned a paper on the topic of turning the concept into corporate cash, via government purchasing.  He talked about "real jointness."  That term also applies to the Government-Corporate Monstrosity, Eisenhower's MIC on $13 trillion in federal steroids.

Welcome to the real joint, where political influence, high dollars and government largesse overlap.  It caters to Carlyle and its PEU ilk.  How many people were charged or went to jail for the following:

SAIC took a $232 million loss provision for costs connected to kickback, wire fraud and money laundering allegations stemming from the CityTime workforce contract in New York.
Carlyle knows full well how to settle for millions without an admission of guilt.

Update 3-5-12:  Jumper's compensation became public.  It includes an annual base salary of $1.2 million plus bonus, besides a signing bonus of $150,000.   His target cash incentive award for the fiscal year 2013 will be $1.4 million, with the potential to earn up to $2.20 million. Jumper also will be eligible to receive equity valued at up to $4.5 million. 

Sunday, February 19, 2012

Geldorf, Bono: PEU's to Rock Africa & Facebook


The Independent reported:

An Africa-focused private equity firm, fronted by former Boomtown Rats singer and Live Aid organiser Bob Geldof, has raised close to €160m from well-heeled investors keen to buy stakes in enterprises and companies across the continent.

Last week 8 Miles closed its first fund -- having raised €155m -- with pledges to invest from the World Bank, the African Development Bank, UK state overseas investment firm CDC Group, as well as institutional and private investors, including African buyout fund Vital Capital.
The World Bank has an established track record in global tampering, required to open markets for the West.  Note:  The first three investors are state funded organizations.

Africa has a long history of Western state-sponsored intervention, the most recent being the ouster of Libya's Muammar Gadhafi.  It seems Gadhafi used Libya's billions to advance the African continent.  Did he require 30% annual returns like The Carlyle Group, a major private equity underwriter (PEU)? What returns did Geldorf's 8 Miles promise investors?

Elevation Partners, with U2's Bono as managing director, will make over $1 billion in Facebook's IPO according to The Independent.

Bono is involved with private equity firm Elevation Partners, which invested $270m for a 1.5 per cent stake in Facebook -- the shares are worth up to $1.5bn (about €1.14bn)

Bono personally invested in Facebook, as well.  While Bono cashes in, Geldorf looks to bleed African firms, at least of management fees and a percent of profits.

In "Why the West Wants fhe Fall of Gadhafi", Jean-Paul Pougala wrote:

Africa's strength and real freedom will only come if it can take properly thought out actions and assume the consequences. Dignity and respect come with a price tag. Are we prepared to pay it? Otherwise, our place is in the kitchen and in the toilets in order to make others comfortable.
PEU's are all about finest places, the rarest historical documents.  They expect to be comfortable, very comfortable.  Unfortunately, it's Africa's turn to be bled by 21st Century Robber Barons.

Update 3-1-12:  Geldorf pushed 8 Miles at the Berlin SuperReturn conference. Geldorf is "promising investors an internal rate of return of over 25 percent."  He's got the PEU sales pitch down, including the puffery.

Saturday, February 18, 2012

Carlyle's Rubenstein & Demands of Barons

McClatchy Newspapers highlighted the new interactive Magna Carta exhibit at the National Archives.   The piece acknowledged the document's influence on America's founding fathers, doing so via comment from The Carlyle Group's David Rubenstein, the owner of the version on display..

The new display case is found in the west Rotunda gallery of the National Archives. The Magna Carta is flanked by two interactive computer terminals where, by touching a screen, visitors can read the document in English, discover how it applies to American legal history, and see who has cited the importance of the document.
Last year I noted the irony of Rubenstein, a modern day robber baron, preserving the document of barons.  The Archives description reinforces my point:

Magna Carta was written by a group of 13th-century barons to protect their rights and property against a tyrannical king. It is concerned with many practical matters and specific grievances relevant to the feudal system under which they lived. The interests of the common man were hardly apparent in the minds of the men who brokered the agreement.

The National Archives could look at the present, where the Rubensteins of the world seek "private equity friendly" totalitarians to grow their billions.   The barons never left, their grievances remain much the same.  Protect private equity underwriter (PEU) rights and property  It's a global PEU feudal system, where post-modern serfs are shareholders.

Meanwhile, the Rehab PEU Rubenstein Tour marches onward and upward.  Aren't PEU's cute?

Pay fealty to the barons, for they are king makers.

Texas Teachers Go PEU


The Texas Teacher Retirement System (TRS) purchased a $250 million equity stake in Bridgewater Associates LP, the world's largest hedge fund.  The teacher pension fund is the state's biggest and 23rd largest in the world. This move came after TTRS invested $3 billion each with KKR and Apollo Global, giant private equity underwriters (PEU's).

Bloomberg continued their obtuse characterizations of such deals with:

Bridgewater Associates LP, the hedge fund run by Ray Dalio, agreed to sell a $250 million equity stake to Texas Teacher Retirement System as the firm diversifies ownership from its founder.
More like:

The founder cashed in a sliver of his stake for a quarter billion.
Bloomberg, feel free to use it as owner Ray Dallo continues monetizing his founder holdings. 

Our hope is that most of the company’s ownership will be transitioned in this way over the next 10 years, with Ray and his family trusts maintaining ownership interests of between 10 and 20 percent."

It's so passive and third person, the exact opposite of the way Hedgies/PEU's operate.

I expect Texas Teachers knew the risks of investing in Bridgewater.

Britt Harris, chief investment officer for Texas Teacher,was CEO of Bridgewater from November 2004 through June 2005. 
Bridgewater's Dallo implied Harris' "fabulous character" didn't fit with hedge firm culture, which I see as hyper-aggressive, obsessed, solely bottom line focused.   Culture clashes with Bloomberg's very language on the Texas Teachers' deal

Founders want the money, but won't give up an iota of control.  Bridgewater's deals involve nonvoting stock.  The Carlyle Group's co-founders keep control of every important decision post IPO.

Investors, public pension of general public, are expected to fork over cash and have few rights in return. Somehow, this is characterized as economic freedom.  It's certainly freeing to the pocketbooks of billionaire PEU founders.

Texas Teachers have their share of the golden goose, only if the goose fails to lay a good egg, teachers could be on the line for millions in capital calls.  Ask CalPERS how much they had to fork over to The Carlyle Group in the 2008 financial meltdown?  CalPERS owned 5.5% of Carlyle which demanded $681 million in capital calls.  CalPERS ponied up, something Carlyle refused to do earlier that year when Carlyle Capital Corporation (CCC) imploded.

Freeing billionaire pocketbooks, good.  Constraining billionaire pocketbooks, bad.  That's the Texas Teacher lesson for the day. This message was brought to you by TRS.

Friday, February 17, 2012

Carlyle Group: C3IPO


Valentine's Day found the SEC posting The Carlyle Group's latest IPO filing.  It's the third amended version and second in 2012.

Because The Carlyle Group L.P. will be a holding partnership and will have no material assets other than its ownership of partnership units in Carlyle Holdings held through wholly-owned subsidiaries, we will fund distributions by The Carlyle Group L.P., if any, in three steps:

First, we will cause Carlyle Holdings to make distributions to its partners, including The Carlyle Group L.P.’s wholly-owned subsidiaries. If Carlyle Holdings makes such distributions, the limited partners of Carlyle Holdings will be entitled to receive equivalent distributions pro rata based on their partnership interests in Carlyle Holdings;

Second, we will cause The Carlyle Group L.P.’s wholly-owned subsidiaries to distribute to The Carlyle Group L.P. their share of such distributions, net of taxes and amounts payable under the tax receivable agreement by such wholly-owned subsidiaries; and

Third, The Carlyle Group L.P. will distribute its net share of such distributions to our common unitholders on a pro rata basis.
It's partners first, shareholders last:

In addition, the partnership agreements of the Carlyle Holdings partnerships will provide for cash distributions, which we refer to as “tax distributions,” to the partners of such partnerships if the wholly-owned subsidiaries of The Carlyle Group L.P. which are the general partners of the Carlyle Holdings partnerships determine that the taxable income of the relevant partnership will give rise to taxable income for its partners. Generally, these tax distributions will be computed based on our estimate of the net taxable income of the relevant partnership allocable to a partner multiplied by an assumed tax rate equal to the highest effective marginal combined U.S. federal, state and local income tax rate prescribed for an individual or corporate resident in New York, New York (taking into account the non-deductibility of certain expenses and the character of our income). The Carlyle Holdings partnerships will make tax distributions only to the extent distributions from such partnerships for the relevant year were otherwise insufficient to cover such tax liabilities. The Carlyle Group L.P. is not required to distribute to its common unitholders any of the cash that its wholly-owned subsidiaries may receive as a result of tax distributions by the Carlyle Holdings partnerships.
The IPO is rigged in the DBD's favor.  Carlyle's co-founders control compensation, scoffing at the notion of a board level compensation committee.

Our historical cash distributions include compensatory payments to our senior Carlyle professionals, which we have historically accounted for as distributions from equity rather than as employee compensation, and also include distributions in respect of co-investments made by the owners of the Parent Entities indirectly through the Parent Entities. Distributions related to co-investments are allocable solely to the individuals that funded those co-investments and would not be distributable to our common unitholders. Additionally, the 2010 Mubadala investment was a non-recurring transaction that resulted in a distribution to the existing owners of the Parent Entities in 2010.

The IPO is but Carlyle's latest cash-in. Stockholders are to help the DBD's montetize, nothing more.  Consider the owners as Han Solo under the C3IPO filing:

C3IPO: Sir, If I may venture an opinion...
Han Solo: I'm not really interested in your opinion C3IPO

It's symbolic they call them Units and Unit Holders  Bring on the investment drones..

Tuesday, February 14, 2012

Carlyle to Cash-In on Talaris


The Carlyle Group purchased De La Rue's Cash Systems division in June 2008 for £360 million and renamed it Talaris.  Carlyle will pull a double by selling Talaris for £650 million to Glory of Japan.  That doesn't count management fees or special dividends/distributions.  How much cash did Carlyle pull out of Talaris prior to monetizing the company?

De La Rue employed 2.300 in the division Carlyle purchased.  Carlyle's Talaris cut jobs to 2,100 employees in 2009. Today, employment sits at "over 1,900."

While Carlyle investors pull a double or better, how did employees, roughly 17% fewer in number, do under Talaris?  Did Carlyle dump the pension, like it did with RAC and Brintons?  Did it reduce or eliminate any 401(k) matches or their foreign equivalents?  How did it stooge employees in growing the bottom line?

Earnings have increased by more than 40% under Carlyle’s ownership.

Whose hands will garner Talaris' final cash dispensing?  For Carlyle, it's a PEU world.  (PEU stands for private equity underwriter.)

Update 7-3-12:  The EU approved Glory's buyout of Talaris.  

Sunday, February 12, 2012

SEC'S PEU Inquiry


Reuters reported:

The Securities and Exchange Commission has launched an inquiry into how the private equity industry values its investments, how those investments are marketed, and other practices, the Wall Street Journal reported on Saturday.
Recall that Dodd-Frank gave non-bank private equity underwriters (PEU's) a free pass.  It required a study of PEU self regulation.

A GAO report stated it could be done, given changes in law and establishing a funding mechanism.  The report did say:

SEC will assume responsibility for overseeing additional investment advisers to certain private funds on July 21, 2011. It plans to oversee these advisers primarily through its investment adviser examination program. However, SEC likely will not have sufficient capacity to effectively examine registered investment advisers with adequate frequency without additional resources, according to a recent SEC staff report.
Private equity pushed their relative safety in the aftermath of the financial crisis:
Law firm Davis Polk offered the PEU take on Dodd-Frank:

Unaffiliated private equity firms would be subject to the systemic risk regime, only if designated as systemically important, which we expect to be rare in the private equity sector.

PEUReport questioned Carlyle's lack of systemic risk in the financial meltdown, given it made over $680 million in capital calls to CalPERS, a 5.5% owner,  How much did Mubadala Development Company have to kick in to keep Carlyle afloat, given it held 7.5%?  Did Mubadala pony up $925 million, the same capital call to investment as CalPERS?

Carlyle affiliate Boston Private Financial Holdings received $154 million in TARP funds.  That capital injection aided the borrowing needs of "high net worth individuals."  Adding the three capital injections, Carlyle needed $1.75 billion to navigate the crisis.

What if CalPERS, Mubadala or TARP said no, like China did with its derivative commitments?  There'd be a PEU run, far more severe than investors dumping stakes at a discount to the likes of Goldman Sachs.

Reuters closed with a PEU plug:

The private equity industry has steered clear of recent trading scandals and was not at the core of the housing market's collapse.
Carlyle Capital Corporation (CCC) failed in March 2008, six months before Lehman Brothers.  It borrowed heavily to invest in mortgage backed securities.  Carlyle walked away from capital calls on CCC, unlike CalPERS.  That speaks volumes.

Click on the image above to make it larger.  Every picture tells a story, most of which are chronicled on this blog. 

Update:  Dealbook weighed in on the SEC's PEU inquiry

Saturday, February 11, 2012

PEU to Foul Edinburgh Air Travel?

The Telegraph (UK) reported:

Global Infrastructure Partners, 3i and a consortium backed by US private equity giant Carlyle Group are due to take an early lead in the race for Edinburgh Airport as the deadline for first-round bids expires this week.

Carlyle is in with merchant bank Noble Grossart.  Did Brintons' founders have any money with Noble Grossart? 

Carlyle owns ARINC, which provides airport technology software and hardware.  It has Sequa Corporation, whose website stated:

Chromalloy Gas Turbine Corporation, Sequa’s largest business unit, provides the airline industry with a broad range of aftermarket services and ranks as the leading independent supplier of advanced repairs for jet engine parts. Chromalloy operates around the world and around the clock, providing airlines with timely, cost-effective, and proven repairs for turbine airfoils and other critical engine parts – repairs that extend the life of the parts and hold down airline maintenance costs.
Last is Wesco Aircraft, an integrated inventory management company for aerospace manufacturers and maintenance firms.

ARINC is the most likely of Carlyle's current affiliates to get spin-off business from Edinburgh Airports, should the Carlyle consortium win.  However, Carlyle could lever its affiliates under Edinburgh's planned maintenance expansion, the green area in the map below:


The Edinburgh Airport would land in Carlyle's Infrastructure section, which holds QUBE, an Australian logistics provider.  QUBE has Australia's leading international air and sea freight logistics provider.

Carlyle's Infrastructure division also has Synagro Technologies, which bribed Rep. John Conyers' wife for Detroit's sewage sludge business.   How appropriate for a PEU, private equity underwriter...

Update 3-9-12:  Carlyle pulled out of bidding, according to sources.

The Highs & Lows of Obama's Taxing Lines


In his State of the Union address President Obama offered

Companies that choose to stay in America get hit with one of the highest tax rates in the world.  It makes no sense, and everyone knows it.

From now on, every multinational company should have to pay a basic minimum tax. And every penny should go towards lowering taxes for companies that choose to stay here and hire here.

Third, if you're an American manufacturer, you should get a bigger tax cut.
Sorry Mr. President, American corporations paid the lowest tax rate in forty years under your term.  According to a CBO study:

As a percentage of ever-growing profits, corporations are paying less in taxes than they have in decades.

Thanks in part to federal tax breaks, corporations paid out just 12.1 percent of their 2011 profits in taxes, according to the Congressional Budget Office. That's well below the country's top marginal corporate tax rate of 35 percent.

I've written many times regarding the global race to the lowest common denominator on taxes, worker pay/benefits, and regulation.

Obama believes government should do more to pick winners and losers, the China model favored by Carlyle Group co-founder David Rubenstein, a private equity underwriter (PEU).

If you're a high-tech manufacturer, we should double the tax deduction you get for making products here. And if you want to relocate in a community that was hit hard when a factory left town, you should get help financing a new plant, equipment, or training for new workers.
Rubenstein knows about government non-debt, non-equity capital injections, given Carlyle's Vought Aircraft got over $100 million from Texas and South Carolina to expand operations and provide employment.  Texas waited eight years for promised jobs, which never arrived.

Oddly, a corporate tax cut would be timely for The Carlyle Group, a virtual nonprofit, as it nears a public offering. Carlyle had this to say in their latest S-1/A:

If we were taxed as a U.S. corporation or required to hold all ISPIs through corporations, our effective tax rate would increase significantly. The federal statutory rate for corporations is currently 35%.
Carlyle's Rubenstein recently saturated the airwaves, highlighting his good deeds.  One interesting fact he shared:  Rubenstein's copy of The Emancipation Proclamation hangs in the Oval Office.

Should Mr. Rubenstein stop by The White House to view his investment, might he lobby President Obama on the need for lower corporate taxes?  If so, Rubenstein's fellow co-founder, Bill Conway, would most grateful.

Carlyle Group Cites China as U.S. Savior


The Council on Foreign Relations followed the World Economic Forum in lauding China as the future for America.  CFR posted the piece under "Renewing America:"  They even loaned their logo for The Carlyle Group's David M. Marchick to use in his memo:


The Carlyle Group wants Chinese investments to fund U.S. deals.  Carlyle Managing Director David Marchick was assisted by Carlyle's Daniel Bowles in authoring the piece, which concluded:

Greater investment by China in the United States is not only a natural evolution in China’s economic development; it also yields significant benefits to the economies and welfare of citizens of both countries. More than $1 trillion of FDI is projected to flow from China into the global economy by 2020. President Obama, by articulating the right policies and setting the right tone during the Xi visit, could help ensure that the United States receives a significant share of this investment—for both countries’ benefit.

How much of that $1 trillion in FDI might land in Carlyle's greedy hands?  Who knew Renewing America meant giving the Chinese 30% annual returns on $1 trillion in FDI?  Who'll pay the freight on that?  American customers, who already roll the dice for China's abysmal management practices..

Does David Marchick want to push more cadmium tainted jewelry on children?

Update 2-12-12:  The Xi visit includes a Valentine's Day stop at the White House   Sweet!

Friday, February 10, 2012

Carlyle to Bid for Sacramento Parking Concession?


The Carlyle Group is listed as a qualified bidder for a 50 year concession on Sacramento's downtown parking.  Ten potential bidders have been approved.  One might want to look over Chicago's parking experience. 

Funds raised from selling city-owned parking garages would help build a new facility for the Sacramento Kings NBA team.

Thursday, February 9, 2012

Private Equity Association Names Judge

A private equity underwriter (PEU) trade group named its new CEO.  Dealbook reported:

The Private Equity Growth Capital Council plans to formally appoint Steve Judge as its chief executive on Monday

I offer a bolder, more penetrating name for the PEU association.

Private
Equity
Capital
Knowledge
Executed
Responsibly

I admit the name differs from their old standard.  But it seems PEU boys like nonstandard measures.

Let the PEU good times roll:

Buyout funds globally are seeking to raise about $165 billion, more than in 2006 at the height of the fundraising boom, according to Preqin.
Engorgement?  It's what you'd expect from the PECKER Network.

Tuesday, February 7, 2012

Carlyle's LifeCare & Mrs. Fields Meet Real Mex & Friendly's

The Carlyle Group used debt to engineer a takeover of Mrs. Fields.  I recently pondered whether Carlyle, owner of LifeCare Hospitals and a portion of the company's debt, would cram itself down when $120 million in debt comes due next year?

Real Mex restaurants declared bankruptcy and faces two bidders for the chain, neither of which are The Carlyle Group.  Nations Restaurant News stated:

Real Mex is owned by private-equity firm Sun Capital Partners, based in Boca Raton, Fla., which also owns Friendly’s Ice Cream Corp.

Friendly’s also filed for bankruptcy in October and was put up for auction in December — only to be repurchased by Sun Capital in a credit bid deal that closed last month.

In repurchasing the company (Friendly's), Sun shed many of its leases and unsecured debt, including employee pension obligations.

Executed like a true PEU. Carlyle is also known for pension shedding.

Monday, February 6, 2012

CFO's Smell PEU


Private equity has much to explain, according to CFO magazine.  One private equity underwriter (PEU) offered:

“In the ‘80s the value add was leverage; now the value add is really value add.”

Try up until 2008 the value add was leverage.  PEU's still charge management fees and pay themselves special dividends/distributions, some debt financed.  Opaque private equity calls "debt for dividends" = "liquidity recapitalizations."

The value add includes dramatically higher interest payments, which aids tax avoidance.  PEU's buy deeply discounted debt of affiliates, making them double sponsors.

It's significant when CFO's say private equity has explaining to do.  PEU's count on the "C Suite" to send potential affiliates their way.  Their puffery pitch is:

"Make some money now, but your profitgasm is but a few years away.  Join the G-men."

G is for Greedy.  It's amazing how many become PEU's.

Sunday, February 5, 2012

Fannie Execs Buried Lavalle Report


Nye Lavalle blew the whistle on questionable practices at Fannie Mae in 2003.

For two years, he corresponded with Fannie executives and lawyers. Fannie later hired a Washington law firm to investigate his claims. In May 2006, that firm, using some of Mr. Lavalle’s research, issued a confidential, 147-page report corroborating many of his findings. And there, apparently, is where it ended. There is little evidence that Fannie Mae’s management or board ever took serious action. 
Several D.C. household names occupied Fannie Mae leadership roles in 2003, Tom Donilon, Jamie Gorelick, Warren Rudman and Ken Duberstein.  Surely, these folks saw or heard elements of the Lavalle report.

Odd, the PDF document of the Lavalle report is searchable only to page 94.  Pages 95 on have been scanned.  I found this odd after seeing Senator Warren Rudman, a Fannie Mae board member, listed on page 130 .  A document search found only one Rudman reference.  It was on page 16.

Fannie Board member Ken Duberstein also consulted with Fannie on regulatory issues.  He received over $1.8 million from 2002-2006 for consulting services.  What did The Duberstein Group have to say about the Lavalle allegations?
Rest assured, the public won't know, not in this PEU world.

Chris Wallace Wowed by Rubenstein's Philanthropy


I'm not sure Chris Wallace said a word in his 1:17 Power Player Plus piece on Carlyle co-founder David Rubenstein.  Rubenstein showed various pieces he purchased:

1.  Replica of first map of United States (loaned to Library of Congress)
2.  Replica of 13th Amendment (at New York Historical Society)
3.  Replica of The Magna Carta (loaned to National Archives)
4.  Copy of the Emancipation Proclamation (on display in Oval Office)
5.  Rare Copy of the Declaration of Independence (at State Department)


Did anyne notice the pandas, symbolizing Rubenstein's other charitable acts? 

Frankly, I'm surprised Chris Wallace wasn't carrying a microphone in the form of a replica of the Washington Monument.  I had to replay the piece several times to hear Wallace manage an "Oh, right here" and an "Ohhh".


Such stellar journalistic contributions should enlighten the masses on private equity underwriter's predatory nature and how politicians and the media cater to PEU leaders.  It's the latest example of kow towing.

Fair enough for a PEU...

Update 2-25-12:  Rubenstein said his copy of the Emancipation Proclamation was "now on display at the White House."   If so, it's a low profile display.  Also, how could Rubenstein be pointing at the one hung in the Oval Office, if it's in the White House?  What does six months hanging in the Obama Oval Office do to the value of a rare document, should Rubenstein ever decide to flip it?

Carlyle's Rubenstein on Fox New Sunday

It's Chris Wallace's turn to pander to Carlyle Group co-founder David Rubenstein.  LA Times reported:

Fox News Sunday With Chris Wallace Presidential race: Former Sen. Rick Santorum (R-Pa.). GOP presidential nomination: Romney supporter Gov. Bob McDonnell (R-Va.); Former Rep. J.C. Watts (R-Okla.). David Rubenstein, the Carlyle Group. Panel: Bill Kristol; Liz Marlantes, Christian Science Monitor; Liz Cheney; Juan Williams. 10 a.m. KTTV

Are Fox viewers in for another Mark Zuckerberg joke?  It's a PEU world.  PEU stands for private equity underwriter.

Saturday, February 4, 2012

Carlyle's LifeCare Settled Katrina Deaths?


The Carlyle Group's LifeCare Hospital of New Orleans lost 25 patients in the hellish aftermath of Hurricane Katrina.  Carlyle, a politically-connected private equity underwriter (PEU), blamed FEMA in its defense of wrongful death lawsuits.

LifeCare's most recent 10-k stated under "forward looking statements:"

The effect of legal actions or other claims associated with the circumstances arising from Hurricane Katrina could subject us to substantial liabilities.

Carlyle vigorously defended the company in Katrina deaths.  These suits require resolution before Carlyle can "liquefy" LifeCare.  Carlyle Group co-founder recently characterized "cashing in" as "liquefying."  That's a disturbing analogy given Katrina's liquid nightmare.

LifeCare imposed a different bad dream on employees, at least those wanting help in saving for retirement.

Retirement Plan. All employees of our company are eligible to participate in our 401(k) plan, and can contribute up to 50% of their base salary (subject to statutory limitations). Prior to 2010, we had the discretion to match up to 33.3% of the first six percent of eligible employee contributions to our 401(k) plan. The matching contributions were made in cash and vested over a three-year period. For the year ended December 31, 2010, matching contributions were suspended.
LifeCare executives had several lifelines not available to employees.  They have severance benefits from six months to two years of pay.  There's much more:

In April 2008, we entered into transaction bonus agreements with certain members of our management. Transaction bonus agreements will provide a one-time bonus opportunity in connection with a change of control transaction.
When Carlyle flips LifeCare, members of the "C Suite" can cash in big.  Transaction bonuses could be as large as 10-15 times the executive's annual salary. 

LifeCare also provides performance based cash incentives and long term equity awards to executives.  As LifeCare did not hit its EBITDA targets in 2010, despite the 401(k) jettison, no cash incentives were awarded.

Carlyle emphasized 2011 targets needed to achieve the prize:

For 2011, the base target incentive opportunity will be equal to 60% of base salary for our Chief Executive Officer, Chief Financial Officer and Executive Vice President of Operations and 35% for our General Counsel, Chief Compliance Officer. No amounts will be paid unless target EBITDA is achieved.

The plan also provides for the payment of incremental performance-based cash incentives to the extent actual EBITDA exceeds target EBITDA. The Chief Executive Officer and Chief Financial Officer are eligible to receive a maximum performance-based cash incentive of 100% of base salary. The incremental performance-based cash incentive is earned on a pro-rata basis for EBITDA in excess of 100% of target up to a maximum of 110% of target.
That measly 2% 401(k) match won't be back anytime soon.  In what other ways did LifeCare squeeze workers in the march toward EBITDA targets?  Seeing employees as "associates" and sharing gains is so last century.

LifeCare changed their Katrina language in recent SEC filings.  It went from:

We are currently defending ourselves against one Hurricane Katrina related lawsuit. We are vigorously defending ourselves in this lawsuit, however, we cannot predict the ultimate resolution of this matters.
to:
All claims raised in connection with Hurricane Katrina have been settled with no significant impact to us, except as follows. We maintained $15.0 million of general and professional liability insurance during this period, subject to a $1.0 million per claim retention. We believed that under our insurance policies, only one retention was applicable to the Hurricane Katrina matters since these matters all arose from a single event, process or condition. However, our insurance carrier sent reservation of rights letters which challenged, among other things, the application of one retention to the Hurricane Katrina related matters. On June 5, 2009, we reached an agreement with the insurance carrier regarding the reservation of rights matters whereby they would continue to pay all costs, indemnification and related expenses for the Hurricane Katrina claims in consideration for an additional $1.0 million, which was paid by us in three equal installments, on July 1, 2009, March 31, 2010, and March 31, 2011.  
Private equity underwriters (PEU's) speak so obtusely..Tenet Health publicly settled its Katrina lawsuits for $25 million.  The article mentions LifeCare paid "more than $200,000" to the son of a deceased patient.

Some relatives of patients who died at Memorial have opted out of the class-action suit and pursued separate claims against Tenet and other defendants.
LifeCare was clear as a New Orleans cesspool on remaining wrongful death lawsuits. 

On life support was LifeCare's debt, characterized as Level 2 and "trading" at 75 cents, 72 cents and 98.5 cents on the dollar in late 2010.   How junky is LifeCare's debt?  It's most recent 10-q stated:

The weighted average interest rate applicable to the $309.8 million outstanding under our term loan facility was 13.50%.
That's serious crap. Carlyle is happy to pay interest, but hates paying taxes and standard employee benefits.

LifeCare has $120 million in debt due August 2013.

We and our subsidiaries, affiliates or significant stockholders may from time to time seek to retire or purchase our outstanding debt through cash purchases and/or exchanges for equity securities, in open market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.
Will Carlyle cram itself down in 2013?

The Carlyle Group purchased Brintons' distressed debt, then used it as a Trojan horse to takeover the company. In securing Brintons, a British carpet maker, Carlyle dumped the employee pension fund.

It's the PEU billenium, where Carlyle is the savior for pension funds, while its affiliates abandon retirement benefits.  Workers may have to die on the job.

Update:  The Katrina wrap-up bow is almost complete.  President George W. Bush has been rehabilitated, "white washer" Homeland Security Adviser Frances Townsend delivered a brushback pitch and FEMA remained a whipping post for trying to collect mis-paid funds

Friday, February 3, 2012

Carlyle's IPO & Liquefaction


Carlyle Group co-founder David Rubenstein said he would "liquefy" his stake in the world's premiere private equity underwriter (PEU).  To liquefy Carlyle must attract investors to their looming independent public offering (IPO).  The PEU eliminated one obstacle, by dropping its mandatory arbitration requirement for shareholder disputes. Did they also allow a board committee to set executive compensation for the triumvirate?

Carlyle's PEU model levers investor capital, borrowings/debt, annual management fees, preferred carried interest taxation, special dividends/distributions and "liquidity recapitalizations," more straightforwardly known as debt for dividends.  How firm is this foundation?

The Carlyle Group's publicly traded mortgage backed security fund, Carlyle Capital Corporation, dipped into bankruptcy in March 2008, six months before the September implosion.  Carlyle walked away from CCC, leaving shareholders empty handed.

The Carlyle Group will turn its back on 14 Wall Street, a prized real estate investment.  Will Carlyle dump this historic asset before or after their IPO? 

I did find irony in Rubenstein's "liquefy" characterization.  Analogies for financial crises include "earth shattering" and "meltdown."    Liquefaction occurs when wet, sandy soils are shaken in an earthquake.  Soil foundations turn to porridge, causing buildings to list.

If "liquefy" means monetizing PEU equity states, does that imply private equity will undergo liquefaction, turn to jelly in the next financial earthquake?  Capital calls, Carlyle shareholder serfs.  Capital calls.

Wednesday, February 1, 2012

Bloomberg's "One on One" with Carlyle Group's Rubenstein

Every picture tells a story.  These images are from the Bloomberg Link China Conference.  First, we introduce the protagonist, a multi-billionaire private equity underwriter (PEU).

Next up is the damsel, Bloomberg's PEU reporter:
She starts on topic regarding China.
Oops, she noticed the $3.5 billion Chinese investment.  Aren't professional women attracted to strong, rich men?
Liquefy some of his stake?  The heat rose fast in that interview! That can mean only one thing.  A pair of Bloomberg lips planted fully on a PEU's backside.

It takes a sweet "one on one" to ensure a future session.
There was no investment activity scrutiny, just a two minute PEU-fomercial.