Monday, October 8, 2007

How Private is Carlyle?

During the Bush administration, many well known companies left the public arena. They now reside behind secure walls, sheltered from view by huge private equity firms. They invest in a range of industries, defense, health care providers, electrical power, pharmaceuticals, technology, media, fast food, automobiles, car rentals, consumer goods, and even green products.

The infamous Carlyle Group stands out as both the most politically connected, and one of the most profitable private equity underwriters or PEU's. Their foray into media ranges from internet marketing services to the set top box monitoring your television viewing habits. The later firm will hold its first media and money conference, alongside Rupert Murdoch's new Dow Jones and Company.

The event will be held November 7-8th in New York. Speakers include Michael Eisner, formerly of Disney fame and Norman Pearlstine, former board chair of Time Warner but now a Senior Advisor to Carlyle. Norman will speak about "his switch from the publishing industry to the investment industry during his own keynote interview. In addition, he will impart his view of private equity and its possibilities in the media space, and where he sees newspapers and magazines heading in the coming years."

Will he speak of Carlyle's record stuffing negative stories? Will Norman talk of their bad luck in closing the purchase of LifeCare Hospitals just weeks before Hurricane Katrina made landfall? Will he discuss their record patient deaths post-Katrina? Will Mr. Pearlstine share how he kept their New Orleans hospital out of the White House Lessons Learned report? Not one mention, now that's outstanding work!

But it gets better. Will Norman talk about the unique defense the company is using against wrongful death civil suits? Carlyle's blaming the federal government. They say as soon as FEMA evacuation teams landed in New Orleans, their patients became wards of the federal government. They did so badly in saving their patients, they now want the Justice Department to look the other way as they buy a much larger nursing home company, ManorCare.

Norman's been a busy man, working hard to squelch the odor of his PEU. I'm impressed he had time to write the speech. For a more subtle hint at the nature of private equity, read the Nielsen Company description at the bottom of the news release on the media and money conference:

The Nielsen Company is a global information and media company with leading market positions and recognized brands in marketing information (ACNielsen), media information (Nielsen Media Research), business publications (Billboard, The Hollywood Reporter, Adweek) and trade shows. The privately held company is active in more than 100 countries, with headquarters in Haarlem, the Netherlands, and New York, USA.

Carlyle can't even say, it's ours...