Saturday, January 23, 2010

Is Goldman Sachs Playing RiskMetrics?

The Wall Street Journal reported RiskMetrics is up for bid. The company hired Evercore Partners to handle the sale. Possible bidders include KKR, The Carlyle Group, MSCI, Bloomberg, McGraw-Hill and Thomson Reuters.

One name winds it way through this possible transaction, Arthur Levitt. Mr. Levitt owns 20,702 shares of RiskMetrics with options to purchase 160,417 shares. The company's 2009 Proxy Statement show Levitt controlling over 180,000 shares. He retired from the RiskMetrics board in 2009, choosing not to stand for reelection.

Levitt serves as Senior Adviser for The Carlyle Group, sits on the board of Bloomberg, and advises Goldman Sachs. The first two are potential bidders for RiskMetrics. Goldman could play the stock in the interim. With Mr. Levitt's deep knowledge of RiskMetrics, his advice could be timely.

Should RiskMetrics go for a 30% premium to its recent stock price of $17, Levitt will gross $4 million. Sweet! It might be Arthur Levitt's turn to cash in. I can see why the big money boys want deal flow to continue. Surely Democrat Arthur Levitt will let some of that trickle down.