Saturday, May 29, 2010

Triumph Shareholders Approve Vought Acquisition from Carlyle Group

Over 99% of Triumph shareholders approved the purchase of Vought Aircraft Industries. The seller is The Carlye Group, a politically connected private equity underwriter (PEU). Vought is the latest in a string of monetizations for Carlyle.

It's also a disturbing case of corporate welfare. Texas Governor Rick Perry gave Vought $35 million in 2004 in return for 3,000 new jobs. The Carlyle Group sent those jobs to Charleston, South Carolina, home of an influential Senator with defense connections. When 2009 ended, Carlyle hadn't added one new Texas job. It employed 35 fewer people at its Texas sites. What penalty did Carlyle pay? Very little. Instead of $3.5 million plus five years of accrued interest, Vought paid back $900,000.

The problem is soon to be Triumph's. Maybe, business reporters will pick up the story after The Carlyle Group's sale.