Wednesday, August 29, 2012

Carlyle Group, Hellhound Leech Federal Money

Bloomberg reported:

Carlyle Group LP (CG) and Cerberus Capital Management LP, the two biggest private equity firms in federal contracting, own or control companies that had $8.9 billion in U.S. awards last fiscal year, government procurement data compiled by Bloomberg show.

Both Cerberus and Carlyle are chock full of ex-government insiders.  They know where the money is.  Carlyle and Cerberus have over 50% of PEU government revenue, according to the estimate:

Contractors controlled by private equity underwriters (PEU's) receive about $16.8 billion in annual revenue.
Carlyle has long pursued this tack, buying USIS (1999), United Defense Industries (1997) and Vought Aircraft Industries 1997.  President and PEU Bill Clinton set USIS free from government shackles

How many people know TARP helped Cerberus and The Carlyle Group?  I would bet very few.  They may be aware public pension funds invest billions in PEU's.  Carlyle made big money flipping its USIS holdings.

The Carlyle Group may have enough billions on the sidelines to profit from any looming fiscal cliff.  Watch Carlyle's moves in healthcare, transportation and infrastructure.  They do like buying assets on the cheap, especially those with links to Uncle Sam. 

Tuesday, August 28, 2012

Concordia Kids Clinton Coup

In a year Concordia expanded beyond counterterrorism to public-private partnerships.  It also spread out from the Red team, reaching out to the Bluest of the Blue team.  Pretty impressive from a pair of young men just years out of college.

It didn't hurt that a Clintonite put on the first Concordia Summit.  A big shout out goes to Chris Wayne for the Bushlander Boys continued rise.  Go Concordia Kids!  The Government-Corporate Monstrosity loves these tykes...

Sunday, August 26, 2012

Kuwait Arabs Still Angry at Carlyle Group

The Carlyle Group's sales "puffery" on Carlyle Capital Corporation (CCC) occurred in Kuwait.  CCC was based in Guernsey in The Channel Islands.

Arab money got angry at Carlyle for their series of failures leading to the financial crisis.  Billions in PEU distributions in the last year may have assuaged Arab anger against Carlyle, yet Kuwaiti investors remain perturbed.

WaPo reported:

A Kuwaiti company suing the Carlyle Group over a $25 million investment that went bad is now accusing the private equity firm of marketing the deal without a license as it seeks to have its case heard in Kuwaiti courts.
Carlyle doesn't follow the rules.  It makes them.  Apparently, Arabs have more to learn about our PEU world.

Saturday, August 25, 2012

PEU Governors Slime Red Snapper

Texas Governor Rick Perry and Florida Governor Rick Scott held a Fishing Derby "to promote competition between states as a means of strengthening economic development and job creation across the nation."  Rick Perry may feel stress from the possible closure ot the Vought Aircraft Industries plant in Dallas/Fort Worth.  Dallas Business Journal reported:

The downsizing or closure of Triumph Aerostructures-Vought Aircraft Division in far west Dallas would slice employment and economic activity associated with one of the region’s legacy industries. 
At risk are 2,400 jobs of Vought's roughly 3,000 Texas positions.

Flash back to February 2004, when Perry gave Carlyle Group affiliate Vought $35 million for a promised 3,000 additional jobs.  The company employed 3,300 in Texas at the time. Carlyle steered Boeing 787 Dreamliner fuselage assembly production to South Carolina, causing Vought's Texas job promise to evaporate in the Texas heat.

In 2009 I wrote my Texas Representative who responded 
Since Vought was awarded the TEF grant in 2004, the Legislature has made changes to the program to bring additional financial accountability and penalties for noncompliance. In 2006, the program began disbursing funds on new TEF awards as specific goals are met or upon the closing of a successful agreement which decreases the liability to the State.
The Legislature's changes did not prevent Perry from renegotiating Vought's TEF promise, immediately prior to Carlyle's monetization (sale) of Vought to Triumph.  Perry made changes more favorable to Vought with full knowledge the jobs weren't coming.

A Perry Presidential run didn't surface Rick's fish tale story of adding over 29,000 Vought jobs, when 35 real jobs were lost.  I can see how reporters couldn't fathom how the state gave $1 million per job lost.  It's disturbing.  Carlyle's co-founders enriched themselves at Texas taxpayer expense.

I hope the Red Snapper got to an aquarium in time to be de-toxified.  PEU poisons run deep.  (PEU is my pet name for private equity mavens and their government lackeys).

Update 3-10-13:  Governor Rick Scott will attend a ceremony for Carlyle affiliate TurboCombuster Technology.   Carlyle got nearly $5 million from Scott and local officials for plant expansion in Stuart, Florida. 

Update 12-7-22:  Carlyle announced it is offloading TurboCombuster dba Paradigm Precision to CDR and Greenbriar.  The deal is expected to close in early 2023.

Thursday, August 23, 2012

Carlyle Seeks Brintons Subsidy after Ditching Pension Plan

After dumping Brintons' pension plan on the public, The Carlyle Group wants a government subsidy to update its weaving manufacturing technology.

Carpet-maker Brintons wants to install new technology at its Kidderminster plant, but owners Carlyle, a US private equity group, said it could be persuaded to spend the money in its Portuguese factory after the country offered better incentives than Britain.

The Portuguese Development Agency offered a 45 per cent subsidy on the total cost of investment in new weaving technology, developed by Brintons, while the best Britain could offer was 10 per cent through the Regional Growth Fund.
Carlyle pits one country against the other for a nondebt, nonequity capital injection.  Right now Portugal has the upper hand by offering 3.5 times more cash to Carlyle.

How much did Carlyle's back door acquisition of Brintons' already cost British taxpayers?

By using a pre-pack to acquire the business, Carlyle was able to jettison Brintons' pension fund – complete with its £10.5m deficit. The Pension Regulator is investigating. 

The Pension Protection Fund has been left to pick up the pieces and will almost certainly end up taking over the 1,500-member scheme. 
All's fair in PEU profit maximization.  PEU is my pet name for private equity underwriters.

The race to the lowest global common denominator continues on worker pay & benefits, taxes and regulation.  Exempt from the race downward is CEO/Board pay and economic development subsidies.

Update 2-27-13:  If Carlyle takes over Axminster Carpets out of a pre-packaged bankruptcy, can it ask the British government for a greater subsidy?

Update 9-22-13:  Without pension expenses Brintons returned to profitability and is ready to benefit from Dubai's return to growth.

Monday, August 20, 2012

Rubenstein's Latest Award: Hedge Fund Women

Who knew 100 Women in Hedge Funds would break the story on Carlyle's record AUM (assets under management).

Since co-founding The Carlyle Group in 1987, the firm’s has grown into an institution managing more than $160 billion with 36 offices around the world.
Carlyle's website only lists "more than $156 billion."

The 100 Women in Hedge Funds will give Carlyle co-founder David Rubenstein their 2012 Effecting Change award.  I guess that's far enough away from 2008, when Carlyle lost two funds, Carlyle Capital Corporation and Blue Wave Partners.

Maybe, Jon Corzine will be next with his reconstituted "MF PECKER" hedge fund.  That would be an appropriate follow up to Rubenstein.  As female business journalists clearly understand, kiss the PEU ring or there will be no access to modern robber barons. 

Sunday, August 19, 2012

The Businessman Look

The Romney-Ryan PEU Ticket will debut in seedy Tampa, Florida, according to The Daily Beast.

Tampa: Seedy Host to Republican Coming-Out Party
Florida's Governor is ex-Columbia/HCA CEO Rick Scott.  Under Scott's reign Columbia/HCA improperly billed Medicare and Medicaid and ended up paying $3 billion in fines. 

A Tampa area Republican leader offered this defense of Scott:

“He’s not a politician, and that explains a lot of his behavior; he just looks at things as a businessman would.”
Businessmen expect the government to aid the race to the lowest global common denominator on worker pay, benefits and taxes.  It doesn't hurt to throw in significant non-debt, non-equity, taxpayer-funded capital injections while looking the other way on ethical transgressions. 

Politicians of both stripes aim to serve.  Red & Blue love PEU....

Rothschild Bets Big Against Euro

The Telegraph (UK) reported:

Lord Rothschild has taken a near-£130m bet against the euro as fears continue to grow that the single currency will break up. 

Bets against Lehman Brothers caused the storied firm to fall in September 2008,  How severe a financial crisis might be precipitated by the fall of a regional currency?  

The Rothschilds of the world purchase politicians to do their bidding.  How might British financial leaders respond in a Euro currency crisis? 

Corzine's New Hedge Fund?

Jon Corzine, the man who rode MF Global into bankruptcy, will avoid federal prosecution and may open a new hedge fund.  I offer the following name advice, should Corzine act on this proposition.


MF comes from the firm he imploded.  PECKER is an acronym I created for private equity underwriter (PEU) trade association, intent on showing the good private equity accomplishes.  My pet name clearly incorporates their message:


"MF PECKER Fund" fits a man of Corzine's talents.  Might it be as ubiquitous as PEU's?

What would people do in a crowded street when an investor offered, "My hedge fund broker is MF PECKER....?"  Vomit would be my suggestion.

Update 7-17-19:  The SEC blessed Corzine's new levered $600 million hedge fund. 

Update 8-3-19:   “Why on earth should the SEC allow him to have a license to handle customer money once again?”  Couldn't have said it better.  Corzine is back!

Saturday, August 18, 2012


Presidential hopeful Mitt Romney brags about his background as a private equity underwriter (PEU) at Bain Capital.  Lesser known are Paul Ryan's familial PEU ties.  .Ryan's brother Tobin is a PEU with Seidler Equity  Partners. 

Meanwhile, the Obama team appears ready to let Jon Corzine off the hook.

FORTUNE — Jon Corzine is “weighing whether to start a hedge fund,” according to a NY Times article that also says the former MF Global boss is unlikely to face criminal charges for his role in the brokerage firm’s collapse.

Red and Blue love private equity, so much so, the word PEUbiquitous came to mind.  Eisenhower's Military-Industrial Complex engorged on trillions in federal steroids to become the Government-Corporate Monstrosity.  PEU's are deeply intertwined in America's political fabric.  Both political parties stand to deliver for their PEU sponsors.

Update 9-11-12:  Bloomberg reported PEU Romney avoided PEU Rick Scott (Florida Governor) on the campaign trail. 

Update 11-20-23:  Congress may establish a bipartisan fiscal commission to tackle our country's burgeoning debt.  Senator Mitt Romney is leading this legislative effort.  No word on how many PEUs will serve their interests on this commission.  Thirteen years of preferred "carried interest" taxation.  Sweet!

Romney, Ryan & Rubenstein

The Daily Telegraph glimpsed one tentacle of the Government Corporate Monstrosity.  This involved Paul Ryan's brother Tobin, Governor Mitt Romney and The Carlyle Group.  They used to be called King makers.  Now they sponsor affiliates, politicians and Presidents. 

Tobin Ryan has since 2009 been a private equity executive at the California-based Seidler Equity Partners.

It's a PEU world...

Thursday, August 16, 2012

Carlyle's Medical Tourism: Turkey Time!

Businessweek reported:

Medical Park, a Turkish hospital operator that’s 40 percent-owned by Carlyle Group LP, plans to invest $300 million over two years to set up a hospital chain in Turkey, Star reported, citing Chairman Muharrem Usta.

The company will open two hospitals in Istanbul and one each in Ankara and Izmir, under the Liv Hospital brand, and will sell a stake to help finance the investment, the newspaper cited Usta as saying.

Medical Park hopes the hospitals will earn $100 million of revenue from health tourism, Star said.

I noted the medical tourism link three years ago.  I can't wait for Medicare to pay for U.S. citizens to go to Turkey for care. 

Wednesday, August 15, 2012

HCA's Upcoding and ER Dumping

HCA settled allegations of improper billing with the federal government for $1.7 billion for sins made in the mid to late 1990's.  HCA CEO Rick Scott, currently Florida's Governor, set aggressive revenue targets and held leaders accountable.  Those who met the numbers received Rick's adulation and handsome bonuses, while those who failed were berated, belittled and eventually fired.  Rick Scott prepared HCA well for its eventual private equity ownership. NYT reported:

(PEU) owners, who now occupied the majority of seats on HCA’s board, contributed only about $1.2 billion apiece in equity outlay from funds they oversaw 

The NYT piece highlighted HCA's recent aggressive coding and billing practices, which produced a financial windfall for its PEU owners.  To my ears it rang a virtual echo of the Scott years.

HCA's PEU owners bled $4.25 billion in special dividends from the company prior to its IPO.  NYT shed a bit of light on HCA's ER coding:

HCA was still operating under a corporate integrity agreement resulting from its (Scott years) Medicare fraud settlement, and an independent reviewer was scrutinizing its billing. By late 2008, however, just as the agreement with federal regulators was ending, HCA introduced a new coding system for its emergency rooms
HCA informed investors and the SEC of their planned change in 2010:

Approximately 81% of our admissions of uninsured patients occurred through our emergency rooms.We are taking proactive measures to reduce our provision for doubtful accounts by, among other things: screening all patients, including the uninsured, through our emergency screening protocol, to determine the appropriate care setting in light of their condition, while reducing the potential for bad debt and increasing up-front collections from patients subject to co-pay and deductible requirements and uninsured patients. 
This week's news revealed the impact of such changes in an article titled "EMTALA lacks anti-patient dumping enforcement."  It stated:

Even under health reform, uninsured Americans are still at risk for being turned away from the emergency room or transferred to another facility, known as patient dumping.

For more than two decades, it's been illegal to turn away uninsured patients who need emergency care. EMTALA requires hospitals to screen and stabilize patients regardless of their ability to pay. However, study authors, like the Government Accountability Office and the Office of Inspector General, criticized the U.S. Department of Health & Human Services for lax oversight, specifically over a lack of a public reporting system in which people could report potential violations.
I find it ironic Marilyn Tavenner, the Acting head of Health & Human Services worked for HCA for 25 years.  At one point she sat at the top of the organization, President Outpatient Services Group.  As an insider Tavenner once held nearly 50,000 shares of HCA.  When she ceased her insider role Tavenner held over 15,000 HCA shares. 

If the Clinton administration couldn't hold Rick Scott personally accountable for the carnage he created, I expect HCA's PEU owners to skate under President Obama.  The sad thing is health reform is designed for investors to make big money, a call I made years ago.  HHS' various reimbursement schemes manipulate behavior via "pay for performance."  

It deformed HCA before and clearly is doing so again.  I don't expect much for clinicians or patients who'll have to endure PEU's mean and greedy leaders.  The tonic for America's health care ills may kill the system.  Meanwhile, a high performance model based on intrinsic motivation languishes in plain sight.  Think Mayo.  The Obama solution to health care?  Hold the Mayo...

Update 8-19-12:  HCA revealed the U.S. attorney's office in Miami has launched an investigation into the medical necessity of cardiac procedures at 10 of its hospitals, including several in Florida. The Miami Herald focused an editorial on HCA's perceived abuse.  Also, sleazy Governor Rick Scott will host the GOP Party in seedy Tampa.

Update 10-6-14:  Rick Scott's former accountant said a hand's on CEO like Scott knew HCA had two sets of books, one for the Feds (Medicare & Medicaid) and the other a confidential internal use only set.

Tuesday, August 14, 2012

Carlyle's PEU News

The Carlyle Group juggernaut has its sight set on Getty Images and round two of Virginia Ports privatization.  It took a 13.5% stake in a Chinese medical company.

A federal judge dismissed an investor lawsuit against Carlyle for fraud regarding Carlyle Capital Corporation.  Puffery wins again.  A D.C. court ruled for a D.C. PEU. 

Also, Carlyle let go a senior PEU and plans to refocus its distressed debt fund. 

It plans to focus more narrowly on "control investing" in which the fund buys stakes that lead to control of struggling companies.
Think Brintons or Mrs. Fields  Back-door takeovers happen in difficult times.  

Sunday, August 12, 2012

Energy Future Holdings PEU Moves

Energy Future Holdings will offer $850 million in debt to pay a $680 million dividend, a liquidity recapitalization in PEU parlance. SEC filings stated:

Energy Future Intermediate Holding Company LLC and EFIH Finance Inc. (collectively, the “Issuers”), both wholly-owned subsidiaries of Energy Future Holdings Corp. (“EFH”), announced today that they have priced a private offering of $250 million principal amount of 6.875% Senior Secured Notes due 2017 (the “First Lien Notes”) and $600 million principal amount of additional 11.750% Senior Secured Second Lien Notes due 2022 (the “New Second Lien Notes”). The offering is expected to close on or about August 14, 2012 (the “Closing Date”), subject to customary closing conditions.

The Issuers intend to use a portion of the net proceeds from the offering to pay a dividend of $680 million to EFH in or before January 2013.  

Energy Future Holdings press release went on the say:

EFH will use the proceeds of the dividend to repay the outstanding balance of the demand notes payable by EFH to its wholly-owned subsidiary Texas Competitive Electric Holdings Company LLC (“TCEH”) that have arisen from cash loaned by TCEH to EFH. Pending such use, such portion of the net proceeds from the offering will be deposited into an escrow account. Holders of the notes will have no security interest in the escrow account. The remaining net proceeds will be used for general corporate purposes, which may include the payment of dividends to EFH
EFH will use 11.75% borrowings to retire credit with a 4.5% interest rate?  EFH's most recent 10-Q stated

At December 31, 2011, outstanding short-term borrowings totaled $774 million, which included $670 million under the TCEH Revolving Credit Facility at a weighted average interest rate of 4.46%.

In addition, short-term borrowings of $670 million under the TCEH Revolving Credit Facility were repaid.

With no short term TCEH credit to be repaid, the $680 million is free to be paid out as dividend to EFH per debt covenants.  Might EFH want to park TCEH cash at the parent?

NYPo believes EFH will put TCEH into bankruptcy soon.   TCEH holds $29 billion of EFH's $36.5 billion in debt. .

The washing of money between subsidiaries rings like Enron.  Enron's Ken Lay had Texas politicians slapping hands for Enron campaign cash and turning their heads away from his company's shady dealings. 

Texas Public Utility Commission raised wholesale energy prices from $3,000 to $4,500 a megawatt-hour, effective August 1.  After this 50% increase, the PUC plans to go to $9,000 per megawatt-hour in 2013.  Ironically, Texas wholesale utility prices are "pegged" to natural gas prices, at historic lows.  Why the complete and total disconnect?  It's like Enron II

Which EFH subsidiary benefits from the 50% increase in electrical wholesale rates that went into effect August 1?  It's Luminant, which owns more than 15,400 megawatts of generation capacity.

Read more here:
How might Energy Future Holdings generate cash under new wholesale pricing? 

TXU Energy, a unit of Energy Future Holdings, and NRG Energy, which owns Reliant and Green Mountain, have argued to the PUC that the change in the wholesale price cap should allow them to break fixed-rate contracts.

EFH debt was downgraded:

Fitch lowered the rating of Energy Future Holdings to CC from CCC, which “implies very high levels of credit risk such that default of some kind appears probable at some point in the future.”
This raises questions as to who would buy EFH's latest $850 million debt offerings?

In another PEU move:

EFH will terminate its pension plan for current employees of TXU Energy, Luminant and EFH who are not union members.  EFH plans to distribute pension plan assets by the end of the year.   

That'll make a Merry Christmas in the Cratchit household.

Cratchit: Tomorrow is Christmas and I was wondering if I could have... Half a day off?
Scrooge: Christmas, eh? Uh, er... I suppose so. But I'll dock you half a day's pay. Let's see, I pay you two shillings a day...
Cratchit: Two shillings and a halfpenny, Sir.
Scrooge: Oh yes, I gave you that raise three years ago.
Cratchit: Yes, sir, when I started doing your laundry.
EFH paid its PEU owners over $100 million in management fees:

We pay an annual management fee under the terms of a management agreement with the Sponsor Group, which we reported in SG&A expense totaling $37 million, $37 million and $36 million for the years ended December 31, 2011, 2010 and 2009.

It's a Scrooge Sponsor PEU world.  EFH's PEU Christmas comes when Texas wholesale electricity rates soar to $9,000 per megawatt-houor.  The rest of us are Cratchits.

Update 12-14-15:  Energy Future Holdings is among the top PEU affiliates in fees paid to their sponsor.  Bleed 'em and weep.

Saturday, August 11, 2012

Arctic Imperative: Greed reported:

Rapid change in the Arctic due to melting sea ice brings new opportunities and challenges. To address the complex Arctic agenda, an influential mix of international, U.S. and local leaders will convene at the second Arctic Imperative Summit, August 24–27, 2012, in Anchorage and Girdwood, Alaska.

Sharpening the world's focus on the short-term opportunities and long-term challenges of Arctic development, the Summit features a multidisciplinary group of experts. By engaging with decision-makers from all sectors, Arctic leaders will be in a stronger position to influence responsible development decisions on their shores. 
Short term opportunities, i.e. greed, usually run contrary to long term impact.  Take BP's Oil Spew in the Gulf of Mexico in April 2010.

Arctic Sea ice has receded, making room for oil drilling and shipping.

Alaska is the new oil rush.

"The rapid changing of the Arctic environment demands responsible and sustainable development," says Alice Rogoff, founder of the Arctic Imperative Summit. "Solutions to the complex needs of this region will only be reached if all stakeholders, including its residents, are at the table."     
Alice Rogoff is also know as Mrs. David Rubenstein.  Her husband founded The Carlyle Group, a politically connected private equity underwriter (PEU).  Rubenstein made his first fortune on the backs of Alaskan natives by selling Tribal tax losses to corporations. 

The purveyor of the "Great Eskimo Tax Scam" is going to Girdwood?  Symbolic, at the least.

Update 8-27-12:   A Coast Guard Commandant backed the Alaskan drilling imperative.  An Alaska Dispatch reporter seemed clueless on his state's skimming capabilities, which far outweighed BP's in the Gulf of Mexico.  Although there's a huge difference between paper plans and actual capability.

Friday, August 10, 2012

Carlyle Sticks TCW in Two PEU Funds

The Carlyle Group announced it will take a 60% share in asset manager TCW Group.  The Carlyle Group has $156.2 billion in assets under management, while TCW has $131 billion.  Combined they total $287.2 billion. 

Fortune stated Carlyle would hide the AUM total by parking TCW within two of The Carlyle Group's PEU funds.  If one planned on divesting TCW in a year or two, it wouldn't behoove claiming TCW's $131 billion in assets as under Carlyle management.

Economic net income, a fictitious number to begin with, varies widely from quarter to quarter.  PEU's don't want assets under management to behave similarly.

TCW ended up a distressed sale by Societe Generale.  Bloomberg reported:

Carlyle, based in Washington, started a team dedicated to financial services in June 2007 and, after turnover and leadership changes, hired Olivier Sarkozy in 2008 from Swiss bank UBS AG to head it. The group also includes former Wachovia Corp. treasurer James Burr.

Sarkozy and his team are seeking $2 billion for a new fund to follow the inaugural one that completed raising capital in 2010, according to a presentation viewed by Bloomberg News. The fund is seeking to take advantage of turmoil in the European financial-services industry, regulatory changes and emerging- markets opportunities. 

Distressed investor Carlyle might the first PEU to $300 billion in AUM, the double secret kind.

Update 1-21-13:  Carlyle plans to give 50 of TCW's 150 employee stock holders additional equity in the firm. TCW continues to lose investment managers and teams.  Also, TCW plans to more than double its debt.  Increasing interest expense by 133% should cause managers to roll the dice harder or more often?

Sunday, August 5, 2012

Susser Partners to Monetize Petroleum Affiliate

Susser Holdings purchased Town & Country Food Stores in 2007, then re-branded the stores as Stripes.  Susser Holdings is an affiliate of Wellspring Capital Management LLC, a private equity underwriter (PEU).

Town & County sold out a year after Hirschfeld Steel became an affiliate of Insight Equity, another private equity firm.  Insight turned Hirschfeld into a limited partnership, where the tax obligation is passed on to partners.

Susser plans to do the same with their petroleum division, slated for an independent public offering as Susser Petroleum Partners..  Susser Petroleum's Partners will sell up to $200 million of their holdings.

Susser Petroleum unit holders will be second class citizens, much like those recently buying into The Carlyle Group. 

Our partnership agreement contains provisions that waive or consent to conduct by our general partner and its affiliates that might otherwise raise issues about compliance with fiduciary duties or applicable law. For example, our partnership agreement provides that when our general partner is acting in its capacity as our general partner, as opposed to in its individual capacity, it must act in "good faith" and will not be subject to any other standard under applicable law. In addition, when our general partner is acting in its individual capacity, as opposed to in its capacity as our general partner, it may act without any fiduciary obligation to us or the unitholders whatsoever. These standards reduce the obligations to which our general partner would otherwise be held.
Susser Petroleum's S-1 states:

As a result, conflicts of interest may arise in the future between us and our unitholders, on the one hand, and SHC and our general partner, on the other hand.

By purchasing a common unit, the purchaser agrees to be bound by the terms of our partnership agreement, and each unitholder is treated as having consented to various actions and potential conflicts of interest contemplated in the partnership agreement that might otherwise be considered a breach of fiduciary or other duties under applicable state law.  
Wellspring recently monetized 5 million shares of the parent, Susser Holdings via a $36 per share secondary offering.  The secondary initially looked to go at $20 per share.  Susser's stock soared, garnering Wellspring an extra $80 million 

It looks like Susser executives learned well from their time as a PEU.  The public is invited to make them and their partners wealthier.

Saturday, August 4, 2012

Mitt Romney's Foreign Policy Adviser: PEU & Biden Partner

Three months ago Vice President Joe Biden discounted Mitt Romney's foreign policy as out of date and "back to the future."  Romney's Senior Foreign Policy Advisor Dan Senor offered a stirring defense.

"It is President Obama's track record that has sent a message to our friends and allies, be they in governments or be they in dissident movements, who want to stand with us, who want to lock arms with us, who are looking to American leadership, who are really left exposed and isolated," said Romney Foreign Police Advisor Dan Senor.
Last week Mitt Romney took Senor's position that the Israeli culture positioned its people for economic success.  The U.S. pushed an "economic freedom" meme in the Middle East, which failed to catch fire in the brutally oppressed and politically divided Palestinian Territories. 

Behind this front stage battle, one finds private equity underwriter (PEU) ties.  PEU Dan Senor worked for The Carlyle Group from 2001-2003.  Senor went on to found Rosemont Capital, an investment/hedge fund.

Rosemont's TALF SPV took Treasury money, over $130 million worth.  Here's the picture:

Government largess is a critical success factor with private equity underwriters, through preferred tax status, direct capital injections or access to federal contracts.

Looking at Senor's Rosemont Capital, one finds affiliate Rosemont Realty, which has R. Hunter Biden on its Board of Advisors.

Hunter is the son of Vice President Joe Biden, the man Senor seeks to defeat. Hunter Biden and Dan Senor can set aside personal and political differences in the pursuit of money.  It's the PEU way, supported by politicians of both Red and Blue stripes.

Others have written about Senor's background, but none found the Junior Biden PEU connection.

Update 10-3-19:  Hunter Biden's PEU did a $1.5 billion joint venture with the Bank of China.

Update 11-22-19:  ZeroHedge reported on Rosemont taking TALF money.  

Update 12-18-20:  President Elect Joe Biden calls investigations into son Hunter "foul play."  

Update 10-4-21:  Blue PEU Hunter Biden still owns 10% of a Chinese private equity firm through Skaneateles LLC.  Hunter is the sole owner of Skaneateles. 

Update 6-27-23:  Dan Senor is now Equity Partner, the Chief Public Affairs Officer, and a member of the Management Committee at Elliott Investment Management L.P. 

Hunter Biden received a sweetheart deal from the "Just Us" Department for skirting on his taxes while violating federal firearm laws.  

Lots of news about Hunter but none about his PEU partner.  Politicians Red and Blue love PEU and increasingly, more are one.

Update 6-30-23:  A Senate subcommittee issued a September 2020 report on Hunter Biden's gorging at the insider money trough.  That boy can flat out eat.  It's PEU level greed.

Update 12-8-23:  PEU cleanup on aisle 9.  Hunter Biden indicted on tax charges.

His gross income nevertheless totaled some $7 million between 2016 and 2020, prosecutors said, pointing to his roles on the board of the Ukrainian energy company Burisma and a Chinese private equity fund as well as his position at a law firm.

Hunter did eventually file his taxes in 2020, while facing a child support case in Arkansas, and the back taxes were paid by a “third party,” prosecutors have said in court documents.

Wednesday, August 1, 2012

Booz's $1 Billion Debt-Funded Dividend

The Board of Booz Allen Hamilton approved a $6.50 per share special dividend.  The $1 billion dividend is financed via $2.25 billion in various loans/credit agreements, i.e. a PEU "liquidity recapitalization." 

Flat revenue was due to a decrease in billable expenses and a lower rate of indirect expenses, reducing revenue under cost reimbursable contracts, it said.

How much will rising interest expenses bring under "cost reimbursable contracts," which I imagine are mostly with Uncle Sam?   PEU's hate to pay taxes, but love paying tax deductible and cost reimbursable interest.  It's the state of PEU's, beloved by Red and Blue.