Tuesday, December 22, 2020

Center for Presidential Transition Headed by Former Carlyle PEU


Politico
reported on a podcast from Ted Kaufman, the head of President Elect Biden's Transition Team.  Former Senator Kaufman spoke with David Marchick, the Director of the Center for Presidential Transition.  Marchick is a former Managing Director and Global Head of External Affairs for The Carlyle Group. a politically connected private equity underwriter (PEU) .

Mr. Marchick spent 12 years at the Carlyle Group and most recently served as Managing Director and Global Head of External Affairs and as a Member of Carlyle's Management Committee. He led Carlyle's regulatory and government affairs, communications and branding, and sustainability efforts.

The Biden Team has a PEU Chief of Staff, Defense Secretary, Climate Czar and Secretary of State.  Carlyle's Frank Carclucci was once a Defense Department Chief.  In the old days PEUs went from government service to private equity.  Now they go from the greed and leverage boys to public service.  That doesn't ring right.   

The Advisory Board for the Center for Presidential Transition is chock full of PEUs.  Nearly all the top positions are tied to the greed and leverage boys in some manner.   People is policy, especially when politicians Red and Blue love PEU.

Update 3-14-21:  The PEU boys got a mention in Senator Sherrod Brown's Wall Street vs. Workers speech.

Saturday, December 19, 2020

Jen Psaki Blue PEU Defender


President Elect Joe Biden's Press Secretary Jen Psaki once defended candidate Barack Obama's July 2007 meeting with private equity underwriters (PEU) on Nantucket.  The Hill reported:

At a dark-shingled mansion, one of many tucked along Washing Pond Road on this island’s north shore, Sen. Barack Obama (D-Ill.) met a couple hundred of the nation’s wealthiest Democrats at a $1,000-a-plate fundraiser on Friday to explain why he should be president even though he’ll raise their taxes.

Many residents with summer homes here have made fortunes from private equity deals and hedge funds.

The host of Obama’s fundraiser, Louis Susman, sits on the executive advisory board of Edgewater Funds, a private equity firm based in Chicago, according to the firm’s website.

Flash forward to November 2019.  Cape Cod Times reported:

Joe Biden is back on Nantucket for Thanksgiving, this time as a candidate for president of the United States.

Biden and his wife, Jill, spent some time shopping downtown Monday and Tuesday afternoons.

The location of the family’s stay this year is being kept under wraps. During his time in the White House, it was the Washing Pond home of Louis Susman, former ambassador to the United Kingdom and Democratic Party fundraiser, and later, the Abrams Point compound of Carlyle Group co-founder and prominent Washington, D.C., philanthropist David Rubenstein.

PEUs Susman and Rubenstein hosted Joe Biden in the past.  December 2019 found Barack Obama purchasing an $11.75 million home on nearby Martha's Vineyard.

President Elect Joe Biden appointed a smattering of PEUs to his cabinet, Chief of Staff, Secretary of State, Defense Secretary and Climate Czar).  Biden's Press Secretary has a history of defending the PEU class.  

The greed and leverage boys did very well under President Obama and expect to do likewise under President Elect Biden.  The rest of us, ot so much.

Update 3-14-21:  The PEU boys got a mention in Senator Sherrod Brown's Wall Street vs. Workers speech.

Friday, December 18, 2020

Rubenstein's Declaration Partners Goes Crypto with Paxos


Carlyle Group co-founder David Rubenstein invested in blockchain and cryptocurrency play Paxos.  Rubenstein used his family office Declaration Partners, the lead partner in Paxos Class C funding.  The mover came after selling over 10% of his Carlyle Group holdings in the last month.

Rubenstein and The Carlyle Group used both Red and Blue political parties to grow their fortunes.  Red Team supporter Peter Thiel recently made big money with Palantir's IPO.  He hopes to repeat that with his Paxos investment. 

Prior to the Paxos investment Rubenstein's Declaration Partners invested in Vault, which makes a saliva test for COVID-19.  USA Today ran a story on Vault's DNA test for COVID and how the company is not collecting personal DNA for later use.  This story may be worth monitoring over time.

Update 5-26-21:  Rubenstein said cryptocurrencies are here to stay on CNBC.  Did he declare his personal conflict of interest with his holding in crypto broker Paxos? 

Update 8-30-21:  “I wouldn’t recommend anyone invest in cryptocurrencies,” John Paulson told David Rubenstein, co-founder of Carlyle Group, on Bloomberg TV.

Thursday, December 17, 2020

Trickle Down Fiction, PEUs Cash In


CBS News
reported:

Tax cuts for the wealthy have long drawn support from conservative lawmakers and economists who argue that such measures will "trickle down" and eventually boost jobs and incomes for everyone else. But a new study from the London School of Economics says 50 years of such tax cuts have only helped one group — the rich.

The incomes of the rich grew much faster in countries where tax rates were lowered. Instead of trickling down to the middle class, tax cuts for the rich may not accomplish much more than help the rich keep more of their riches and exacerbate income inequality, the research indicates. 

Carlyle Group co-founder David Rubenstein made numerous trips to Capital Hill to keep private equity's preferred carried interest taxation.  Politicians Red and Blue granted billionaire Rubenstein's request.  Rubenstein recently cashed in over 10% of his Carlyle Group stock.  Hen sold 4.75 million shares before tax hikes could occur.

WSJ reported on an unusual private equity move during our current crisis.

When the economy struggles, businesses typically hunker down and preserve cash by cutting spending and dividends. During the Covid-19 slowdown, companies controlled by private-equity firms have often gone the other way, borrowing heavily to pay big dividends to their owners. 

 The payouts boost returns for private-equity firms but can load their companies’ balance sheets with heavy debt at a precarious moment. The maneuvers can leave companies in weaker financial shape, while helping private-equity firms lock in gains, often a few years after their initial investments. 

 The amount of issued debt tied to such payouts, known as dividend recapitalizations, grew to more than $29 billion this year, up more than 25% from 2019, according to S&P Global Market Intelligence’s LCD. 

The payout boom is striking considering the pandemic’s economic disruption. By comparison, during the last recession, in 2008-09, such activity nearly dried up, the data shows.

Private equity underwriters (PEU) and their founders cashed in during the pandemic, helping the rich keep more of their riches and exacerbating income equality.  President Elect Joe Biden's cabinet is chock full of PEUs.  They generally look after their brethren.  The greed and leverage boys are tight.

Biden Climate Czar is PEU

President Elect Joe Biden will name Gina McCarthy as his White House "climate czar", making the former head of the Environmental Protection Agency his top domestic climate coordinator.  Gina McCarthy became a private equity underwriter (PEU) in June 2017.  The press release stated:

Former United States EPA Chief Gina McCarthy is joining private equity firm Pegasus Capital Advisors as an Operating Advisor, announced the firm today. 

“Pegasus has by far the most talented group of operating and strategic advisors that I’m aware of working in the Sustainability and Wellness sectors, and I look forward to joining the team,” said McCarthy. “I’m excited to put my public service and academic experience to use in the private sector, which is increasingly where most innovation is happening.” 

Pegasus is a private equity firm founded and led by Craig Cogut. Since inception in 1996, Pegasus has invested across five private equity funds and currently manages approximately $1.9 billion in assets

Politicians Red and Blue love PEU.  The greed and leverage boys grew from preferred taxation and accessing Uncle Sam's wallet.  Wages and benefits stagnated as PEU's proliferated in the U.S.

The Biden cabinet is chock full of PEUs.  Pegasus joins Pine Island Capital in providing greedy executives to solve our nation's ills.  That's disturbing sign to this common person.

Wednesday, December 16, 2020

Buttigieg Named Transportation Nominee to PEU Cheers


CNN
reported:

Former South Bend, Indiana, Mayor Pete Buttigieg on Wednesday spoke to the historic nature of being named President-elect Joe Biden's transportation secretary nominee, and said he was "mindful that the eyes of history are on this appointment.

Presidential candidate Pete Buttigieg received over $82,000 in donations from The Blackstone Group, a private equity underwriter (PEU).  

Blackstone founder Stephen Schwarzman believes his firm will make huge profits off the current crisis, as the PEU did after Fall 2008.

“You always have winners and losers — Blackstone was a huge winner coming out of the global financial crisis, and I think something similar is going to happen,” he said.

He then discussed how his firm is generating big revenues today.

“About half of the firm’s earnings are from a real estate business. Just to give you some idea how this breaks, we pick the good neighborhoods, if you will. Real estate has a lot of different sub-asset classes. And we’ve concentrated in logistics. It’s about 36 percent of all the real estate we own,” he said. “We’re the largest owner of real estate in the private world. And that asset class has boomed with huge increases in rents, almost no occupancies, rent collections from almost everyone.”

Transportation nominee Buttigieg 

Biden added that he sees the Department of Transportation as the "site of some of our most ambitious plans to build back better" and that he trusts "Mayor Pete to lead this work with focus, decency, and a bold vision."

The role of transportation secretary is expected to play a central role in Biden's push for a bipartisan infrastructure package.

Politicians Red and Blue love PEU.  

Vice President elect Kamala Harris noted opportunities for PEU investment:

"We will transform our roads and bridges, transit systems, railways, ports and airports, while powering them with clean energy. Spark a renaissance in American passenger rail that will not only connect our country, but unlock job creation and growth across our manufacturing sector," Harris said. 
 
The vice president-elect continued, "And we will expand and upgrade our transportation system in a way that is equitable, serving communities of every size, urban and rural, across our country."
U.S. history shows how private profits can be made from public funds   Britannica noted:

Crédit Mobilier Scandal, in U.S. history, illegal manipulation of contracts by a construction and finance company associated with the building of the Union Pacific Railroad (1865–69); the incident established Crédit Mobilier of America as a symbol of post-Civil War corruption.

The key was how the transportation improvement was financed:

Crédit Mobilier was part of a complex arrangement whereby a few men contracted with themselves or assignees for the construction of the railroad. Along with certain trustees, the manipulators reaped enormous profits but impoverished the railroad in the process.  

It rings familiar.  The PEU way saddles affiliates with enormous debt burdens that can eventually sink the company.  Sponsors usually have pulled a multiple of their original investment from the affiliate by the time it declares insolvency.  

The projects remain to be seen but the PEU boys stand ready

Wednesday, December 9, 2020

Rare Black PE Executive Nominated for Defense Secretary

 

Yahoo Finance reported:

Apollo Global Management Inc. found that among 18,000 potential hires across the U.S., there were only about 95 Black professionals at the principal or director level.  Across all levels, the number was about 250.

That makes Defense Secretary nominee General Lloyd Austin a rare bird.  Austin is a partner with Pine Island Capital Management, a D.C. based private equity underwriter (PEU).

Pine Island imitated fellow D.C. based PEU The Carlyle Group by hiring a smattering of former politicians from both the Red and Blue teams.  Normally, one goes from Defense Secretary to a plum PEU position like Carlyle's Frank Carlucci.  

It's more rare for a Defense Secretary to come from the ranks of the greed and leverage boys.  It's even rarer for the Defense Chief and Secretary of State to come from the same PEU, Pine Island Capital.  What are the odds?.  .

Monday, December 7, 2020

Pine Island Capital Partners Gets Second Cabinet Nominee

What are the odds that a small Washington, D. C. based private equity underwriter would have two partners on President Elect Joe Biden's cabinet?  That very thing happened with the nomination of General Lloyd Austin for Defense Secretary.  Biden already nominated Antony Blinken for Secretary of State.  

Two of the top four cabinet slots are occupied by PEU boys.  Chief of Staff Ron Klain is a PEU.

The greed and leverage boys prioritized interest on debt over raises and benefit improvements for the last three decades.  The PEU class administered the raw deal so many American employees got while founders multiplied their billions.  

The combined wealth of U.S. billionaires surpassed $1 trillion in gains since March 2020 and the beginning of the pandemic, an increase of over 34 percent.

Politicians Red and Blue love PEU.   

Update 12-9-20:  Yahoo Finance noted the Pine Island Capital connection as well as Biden's appointment of several BlackRock executives to key positions in his administration.  A lot of Blue PEU love is going around..

Wednesday, December 2, 2020

Carlyle Group to Profit from Ivermectin Run in India


The Carlyle Group's COVID-19 portfolio is laden with recent investments in Indian pharmaceutical companies.  SeQuent Pharmaceutical manufactures the drug Ivermectin, currently being use in India for the treatment and prevention of COVID-19.  Carlyle bought into SeQuent in May of this year. 

On September 28, 2020 NCBI reported:

According to government portal Clinical Trials Registry India (CTRI), ivermectin is part of at least five ongoing trials in the country [10]. At the latest, the US clinical trials registry has 38 clinical trials from different countries in different stages of completion [11]. Current clinical trials have used ivermectin in a dose ranging from 200 to 1200 mcg/kg body weight, for a duration of 3–7 days, which is showing promising results both in terms of symptomatology as well as viral load reduction [10].

Ivermectin is more cost effective as compared to hydroxychloroquine and azithromycin combination. The overall cost effectiveness, safety profile makes it more lucrative candidate for clinical trials. However, the safety of ivermectin at higher doses, in children less than 15 kg and pregnant women has insufficient evidence and hence is not recommended in these population groups [12]. With the fear of the disease among the population, herd mentality continues in India and social media is still dominated by how to take these drugs and inquiry about their doses continue among the crowd [13]. One such news of ICMR including ivermectin in treatment guidelines for COVID-19 circulated over the social media leading to a heavy over the counter sale of the drug in a short span. As a fact check the Indian Council of Medical Research (ICMR) is still reviewing the benefits of ivermectin and doxycycline as a potential therapy for COVID-19 and no such treatment guidelines is available on the website [14,15]. On April 10, 2020, FDA issued a statement concerning self-administration of ivermectin against COVID-19 referring to recently published in vitro study [4].

Economic Times India reported:

A government official said, "Many states, for example--Uttar Pradesh, are utilising the drug (Ivermectin) as off label for treatment purpose and also for prophylaxis use against Covid-19.  

Indian medical officials are yet to recommend Ivermectin for COVID-19 treatment.

Time of India reported in August:

Uttar Pradesh government has approved the use of Ivermectin as a new medication for the treatment and prevention of Covid-19. The drug will replace hydroxychloriquine.

TrialSiteNews reported:

Tata Main Hospital (TMH), established in 1908, has added the combination of Ivermectin and Doxycycline to its COVID-19 treatment protocol in addition to already adding Convalescent Plasma Therapy for the treatment of SARS-CoV-2 infected patients.

Carlyle is in the plasma business via its February purchase of MAK-SYSTEM, a blood products software company. 

The Carlyle Group plans to profit from the pandemic's shop from home craze.

Private equity firm Carlyle Group Inc said on Thursday it had invested more than $250 million in Pharmapacks, a U.S. e-commerce firm focused on health, personal care and beauty products.
The myriad of ways for Carlyle to profit from widespread COVID-19 include:

Carlyle affiliates can conduct retrospective studies on COVID-19 (TriNetX), disinfect surfaces (Victory Innovations), screen airports for people with fever (Schneider Electric & HGH), test for COVID antibodies (Ortho Clinical), assist with blood plasma collection (MAK Systems), produce antibody drug conjugate (Piramal Pharma Solutions), ensure the maximum hospital bill for COVID-19 patients (TrustHCS), manufacture Ivermectin treatment (SeQuent Scientific) and make federal coronavirus purchasing something other than a clown show (Unison).

Update 12-9-20:  The Carlyle Ivermectin run could be coming to the U.S. very soon.

Monday, November 30, 2020

OMB Nominee Thinks Torture Works


President Elect Joe Biden is a forgiving man in his appointment of Neera Tanden for OMB Chief.  PEUReport wrote in December 2016:

 

Neera Tanden:    To tell me that Biden (or his people - unclear to me who) are calling asking for support. Not doing a hard sell. Apparently, he's having some meeting in Washington that he's asking people to attend.  You've probably heard stuff like this, but on the off chance you haven't, letting you know.  Aug 14, 2015 4:49 PM

John Podesta:   Yup. Hunter, Mike Donilon, Ricchetti. Biden can't seem to lean on people. Still can't figure out whether he'll rally himself to do it. Hadn't heard about DC meeting. Losing more sleep over getting straight answers from Cheryl than this.  Aug 14, 2015 at 9:58 PM

Neera Tanden:  I was just at the Tower of London and the Rack seemed to be a very successful strategy for getting straight answers from at least some people.  (Source: Wikileaks e-mail 4115)


It's funny how today's Blue team sounds so much like the Reds.
 

That was before the Red Team catered to President Trump's insatiable ego and vengeful rages.

President Elect Joe Biden's first two staff picks, Ron Klain and Anthony Blinken, came from private equity.  Neera Tanden catered to The Blackstone Group as Hillary Clinton's campaign advisor.  

Private equity underwriters (PEU) invest in both political parties so they can garner a share of the federal wallet no matter who wins office.  Bloomberg Tax reported on 11-5-20:

Private equity managers and their investors, who were concerned about progressive plans to increase taxes and regulation on their industry, are relieved the expected “blue wave” scenario that would have handed Democrats control of the presidency and both chambers of Congress now looks unlikely.

That’s led to jumps in the fortunes five of the wealthiest private equity titans at publicly traded firms since the election as stock prices rose.

The greed and leverage boys supported Tanden's Center for American Progress.

According to the lists CAP shared with POLITICO, the group received significant donations from some top Wall Street outfits — at least $100,000 from Citigroup and Stephen Schwarzman’s private-equity firm, Blackstone, and $50,000 from Bank of America and Goldman Sachs. Wells Fargo gave $5,000. 

Politicians Red and Blue love PEU.  Two of the three architects of PPACA are PEUs.  Tom Daschle's latest PEU job is with Pine Island Capital Partners while Nancy-Ann DeParle is with Consonance Capital.  Tanden is a PEU fan and will be able to steer vast portions of the federal wallet to the greed and leverage boys.

Update:  Glenn Greenwald eviscerated Tanden on a ZeroHedge post.

Sunday, November 29, 2020

PEU Target FANCL

 

 

Reuters reported a spate of private equity underwriters (PEU) bid for FANCL's Asia business:

More than 10 entities, including buyout firms Blackstone and Carlyle, have lodged bids for skincare brand FANCL's Asia business outside Japan valuing it at close to $1 billion, said people with direct knowledge of the matter.

Bain Capital, MBK Partners, Sequoia Capital and CITIC Capital are also among bidders for CMC Holdings, the sole distributor of FANCL Corp's products in Asia outside Japan, the people said, declining to be named as the information is confidential.

With its ENRICH product FANCL appears to be a good PEU fit. 

Update 12-18-20:  Carlyle made the first cut and remains in the bidding for FANCL

Saturday, November 28, 2020

Biden's Cabinet from PEU Pine Island Capital

 

President Joe Biden's Secretary of State Antony Blinken worked for Pine Island Capital Partners and the Defense Secretary nominee could come from the same private equity underwriter (PEU).  Two candidates, Michele Flourney and General Lloyd Austin have been mentioned for the top civilian defense slot.

Pine Island Capital Partners promotes the company as being deeply connected.  Representing the Red Team are former Senators Saxby Chambliss and Don Nickles, while the Blues have former House leader Dick Gephardt and former Senators Tom Daschle and Byron Dorgan.

How did a D.C. based private equity firm with only two affiliates, InVeris and  Precinmac, attract such talent?  Former Merrill Lynch CEO John Thain could shed light on the answer.

FT wrote about Thain after the 2008 financial crisis:

John Thain is giving us a tour of what is soon to become America’s most infamous office, with its $87,000 rug, $68,000 sideboard, $28,000 curtains – all part of a $1.2m redecoration scheme. This was early December, a little under two months before Thain would be fired in the same room by his new boss, Ken Lewis, chief executive of Bank of ­America.

Thain went on to lead CIT out of bankruptcy and currently sits on the boards of Uber and Deutsche Bank.

Biden's appointment of multiple cabinet members from one PEU would be head scratching.  Then again, politicians Red and Blue love PEU, even if they have a lackluster SPAC.

Update 11-29-20:  NYT wrote a piece citing concerns about some Biden cabinet nominees.  PEUReport isn't alone in questioning how all this talent landed at one relatively small PEU.  Politico also did a piece on this.  Recall Obama health reformer continued to profit from her PEU work as a public servant in the White House.

Carlyle After Another Indian Pharma Company

 

Seeking Alpha reported:

  • Carlyle Group is in advanced talks to buy Granules India, a pharmaceuticals maker, for ~$1B, India's CNBC-TV18 reports, citing three sources with direct knowledge of the deal.
  • That would add on to Carlyle's pharmaceutical industry investments after recently acquiring Sequent Scientific and a  minority stake in Piramal Pharma.

It's not clear how Granules might grow Carlyle's COVID-19 profit plans.  Granules does have a clinical research and manufacturing arm as well as a number of FDA approved drug production sites.

Where Americans see high costs, Carlyle sees grand profits.

Tuesday, November 24, 2020

Everyone Cheers for Yellen


Michael Every of Rabobank wrote on ZeroHedge:

Yellen’s long career arc from academic economics to economic advisor to presidents, then to Fed chief, and now to economic chief for a president, has not exactly overlapped with a concurrent period of relative American economic ascent – or at least not for the majority of its population. Yellen of course expressed her concerns over inequality as far back as September 2014: yet the central conclusion of that speech was that the poor would be less poor if only they had more assets.

Reuters reported in April 2018, two months after she left the top job at the Fed:

Janet Yellen cashed in with her first paid visit to Wall Street since stepping down as Federal Reserve chair, discussing rate hikes and U.S. President Donald Trump at events on Monday that included a dinner for 40 at a CEO’s Manhattan penthouse.

Over the penthouse dinner of lobster, beef short ribs and matzo in the trendy Tribeca neighborhood, Yellen held court with executives from hedge funds, private equity firms and companies, according to two people briefed on the gathering.

The greed and leverage boys are front and center in President Elect Joe Biden's nominations.  Loud cheers for President Elect Biden's Treasury nominee.  Everyone loves Yellen, ..  

Politicians Red and Blue love PEU.

Trump Advisor Schwarzman Ready to Profit Under Biden

 


Axios reported:

It's over. That's what Blackstone chairman, CEO and co-founder Steve Schwarzman — one of President Trump's most loyal allies — and other top Republicans are signaling to the defeated president, 16 days after Joe Biden clinched the win. 

Schwarzman said in a statement to Axios that Biden won and it's time to move on

Bloomberg added:

The Trump era has been wildly lucrative for pretty much anyone who’s been invested in markets. Schwarzman has seen his personal fortune roughly double to $20 billion.

Blackstone had the Blue Team covered with Executive Vice Chairman Tony James and President/COO Jon Gray.

Schwarzman's capitulation was greased by President Elect Biden's appointment of two private equity underwriters, Ron Klain (Revolution LLC) and Antony Blinken (Pine Island Capital).  

In case a history rewrite is needed,  Schwarzman's alter ego Mr. Stone served as close advisor to President Trump.

 

 

That frees up the real Schwarzman to profit handsomely under the Blue Team.  Politicians Red and Blue love PEU. 

Sunday, November 22, 2020

Biden's Secretary of State is PEU


President Joe Biden announced his nominee for Secretary of State, Antony Blinken.  Biden is two for two in naming private equity underwriters (PEU) to his administration.  Chief of Staff Ron Klain worked for Revolution LLC.  Antony Blinken worked for Pine Island Capital Partners.  Their website shows Blinken's status as "on leave."

Pine Island Capital Partners offers a differentiated approach to private equity investing in the middle market. 

Pine Island has combined an experienced investment team with a group of deeply-connected and accomplished former senior government and military officials. Each of our D.C. partners teams with the investment professionals to actively participate in sourcing deals, conducting analyses, winning bids, closing transactions, and directly advising the companies in which Pine Island invests.

Blinken used his deep connections to aid the greed and leverage boys.    

Pine Island Capital Partners seeks to invest in attractive mid-sized companies, with enterprise values ranging from $50 million to $500 million, that are positioned to benefit from the deep industry expertise, experience, and relationships that the firm’s partnership model can offer. 
Investments may take the form of a number of different transactions, including buyouts, roll-ups, recapitalizations, asset sales, divestitures, growth capital, and special situations. 

Surely there are talented Americans who haven't prioritized interest and special distributions over employees.  Blinken represents the winners in the U.S. economy over the last four decades.  He is of the executive class that has screwed workers while profiting handsomely.

Somehow FT couldn't find Blinken's PEU background in their story on Biden's announcement.  Blinken and Flournoy founded WestExec Advisors in 2018.  WestExec and Pine Island are intertwined.

Additional Pine Island Capital Partners are under consideration for cabinet slots under President Elect Biden.  Politicians Red and Blue love PEU.  That pattern is yet to break. 

Update 5-10-21:  ABC News reported:

Late last month, secretary of state nominee Tony Blinken reported making more than $1 million from his consulting firm WestExec Advisors, and entered an agreement to divest from the firm, according to his disclosures. 

What about his stake in Pine Island Capital and their funds/affiliates?

Friday, November 20, 2020

Carlyle to Flip European Lingerie Firms, Double Upgrade


The Carlyle Group hired JP Morgan to help sell Hunkemoller after hiring the same firm earlier this year to move Twin Set.  Both are European lingerie companies.


Bank of America gave The Carlyle Group a double upgrade to buy from under-perform.  BOA cited a looming funding super cycle.  More like a PEU pandemic.

Tuesday, November 17, 2020

Taylor Swift Got Mountain Watered by Carlyle Group


The Carlyle Group financed Ithaca Holding's purchase of Taylor Swift's music.  Variety reported Ithaca flipped those master rights for a big payday.

Some 17 months after Scooter Braun’s Ithaca Holdings LLC acquired Big Machine Label Group and all of its recorded music assets, sources tell Variety the veteran manager and entrepreneur has sold the master rights to Taylor Swift’s first six albums. The buyer, an investment fund, is as yet unknown but the deal is believed to be north of $300 million and closed in the last two weeks. Some insiders speculate the value could be as high as $450 million once certain earn-backs are factored in.

Carlyle co-founder David Rubenstein told Fox Business Maria Bartirome he "remained hopeful that the parties would be able to reach an agreement."

I do think there'll be a resolution of that in the near future," Rubenstein said. "Hopefully, [Swift] can continue to do very good music, but it's something that is more complicated than my being able to resolve it right here."

That was December 2019.  Swift shared her efforts to purchase rights to her music. Swift wrote on social media to her more than 87 million Twitter followers.

"As you know, for the past year I've been actively trying to regain ownership of my master recordings. With that goal in mind, my team attempted to enter into negotiations with Scooter Braun,"
 
"Scooters team wanted me to sign an ironclad NDA stating I would never say another word about Scooter Braun unless it was positive, before we could even look at the financial records of BMLG (which is always the first step in a purchase of this nature."
 
"I would have to sign a document that would silence me forever before I could even have a chance to bid on my own work. My legal team said that this is absolutely NOT normal, and they've never seen an NDA like this presented unless it was to silence an assault accuser by paying them off. He would never even quote my team a price. These master recordings were not for sale to me." 
The City of Missoula, Montana tried multiple times to buy Mountain Water before and during Carlyle ownership.  It took a condemnation lawsuit for Missoula to buy their local water supplier.  Swift does not have such a remedy.

Taylor's Army no longer can boycott Golden Goose sneakers or Supreme streetwear and inflict financial pain on Rubenstein's rapscallions.  Carlyle flipped both investments for more big paydays. 
 
PEU Shamrock Holdings informed Swift of their purchase.
 
Swift said that she was only made aware of Braun selling her masters after she received a letter from a private equity company, Shamrock Holdings, letting her know they had purchased her music, videos and album art.
 
"This was the second time my music had been sold without my knowledge." Swift continued. "The letter told me that they wanted to reach out before the sale to let me know, but that Scooter Braun had required that they make no contact with me or my team, or the deal would be off."
 
Swift also posted a photo of a letter she wrote to Shamrock Holdings.
 
Carlyle is consistent in their use of leverage in their greedy pursuits.  If they can roll Taylor Swift multiple times the average American stands no chance. 

Sadly, Carlyle has targeted the coronavirus for profits.  More cases, more serious illness, the more Carlyle cashes in.  President Trump provided a wide lane for The Carlyle Group to profit from American suffering.    

Update 11-20-20:  Carlyle plans to flip European lingerie makers Twin Set and Hunkemoller.  JP Morgan is assisting with the sale of both companies.  Swift's potential boycott pool is shrinking.

Update 12-10-20:  Swift will surprise release her second album this year, Evermore.  The article stated:
Swift is also currently re-recording her first six albums, amid a dispute over the master recordings with music mogul Scooter Braun. She told an American Music awards audience in November, via a video message: “The reason I’m not there tonight is I’m re-recording all of my old music in the studio we originally recorded it.”

Update 4-12-21:  Swift re-released her Fearless album.  Loyal fans are burying the old versions on Spotify.

Following Friday's midnight release of Fearless (Taylor's Version) — for which Swift re-recorded her music after failing to acquire the rights to her early albums two years ago — Swifties launched a campaign to bury the Big Machine version on Spotify.

Hopefully the unnamed investment firm can claw-back money from Ithaca and The Carlyle Group.  Taylor Swift, like the City of Missoula with Mountain Water, tried many times to buy back the rights to her music. 

Monday, November 16, 2020

Carlyle's COVID Profit Plans


The Carlyle Group intends to profit from the global pandemic.  Carlyle's website states:

While the healthcare industry has permanently changed by the COVID-19 pandemic, it has also accelerated key themes that our Global Healthcare team has been consistently focused on for years.

Three healthcare industry themes that we believe have been accelerated by the coronavirus pandemic: 

  1. Increased emphasis on diversified healthcare delivery  (Brazilian hospital operator Rede D'or Sao Luis)
  2. A shift toward digital innovation and digital disruption (Grand Rounds, OneMedical)
  3. The importance of the bio-pharmaceutical revolution  (TriNetX, PPD, Albany Molecular Research, Piramal)

Carlyle failed to mention the other ways it plans to profit from COVID-19.

Carlyle affiliates can conduct retrospective studies on COVID-19 (TriNetX), disinfect surfaces (Victory Innovations), screen airports for people with fever (Schneider Electric & HGH), test for COVID antibodies (Ortho Clinical), assist with blood plasma collection (MAK Systems), produce antibody drug conjugate (Piramal Pharma Solutions), ensure the maximum hospital bill for COVID-19 patients (TrustHCS), manufacture Ivermectin treatment (SeQuent Scientific) and make federal coronavirus purchasing something other than a clown show (Unison). 

Coronavirus tea leaves suggest more PEU profits to come.  Those leave can be wrong.  Recall Carlyle drove LifeCare Hospitals and nursing home giant ManorCare into bankruptcy. 

More investment by the greed and leverage boys is not a good sign for people struggling to pay for healthcare in the United States.  

Update 3-13-21:  The former PECKER Council highlighted PEU entries in COVID-19 care.  PECKER is an abbreviation for Private Equity Capital Knowledge Executed Responsibly.

Sunday, November 15, 2020

Carlyle to Flip Supreme


GQ reported:

Denver-based VF Corporation, which owns Supreme collaborators like The North Face, Timberland, and Vans, as well as workwear brands like Dickies and Napapijri, announced this morning that it will acquire Supreme for $2.1 billion. Supreme’s current investors, The Carlyle Group and Goode Partners, will sell their stakes. You may recall that Carlyle paid $500 million for a 50% stake in Supreme back in 2017; as one writer has already joked, this makes The Carlyle Group the world’s most successful Supreme reseller.

Carlyle's website never listed Supreme as an affiliate.  It did not post stories on its purchase or planned sale of Supreme.  Private equity is contrary to streetwear cool.  That discord grew when Carlyle owned flashbangs and pepper munitions were used on peaceful protesters. 

Carlyle will make at least a double on its Supreme investment.  Depending on the mix of debt and equity the profit multiple could be far higher than a simple 2X.

Supreme will be leaving as The Carlyle Group at an interesting time.  There is a pandemic from which to profit.  

Wednesday, November 11, 2020

Blue PEU Klain Biden's Chief of Staff

 

President Elect Joe Biden chose Ron Klain as his White House Chief of Staff.  Klain is Executive Vice President and General Counsel for Revolution LLC.  Revolution LLC is considered a venture capital/private equity firm.  

PEUReport ran pieces on Klain, the first in 2014 when he was named the Ebola Czar with no public health background.  The second story ran in 2016 when Klain chose Hillary over Biden. 

It's been a little hard for me to play such a role in the Biden demise - and I am definitely dead to them -- but I'm glad to be on Team HRC.

Somehow Candidate Joe Biden forgave Ron and his political rebirth came in a Biden "Here's the Deal" March 2020 podcast. 

Politicians Red and Blue love PEU.  The appointment of Ron Klain as Chief of Staff shows the greed and leverage boys remain firmly entrenched in America's Government-Corporate Monstrosity.

Update 11-12-20:  Revolution LLC's Steve Case presented with The Carlyle Group's David Rubenstein at the Rise of the Rest CEO Summit in November 2019.   Rubenstein should continue his preferred access to the White House under Biden and Chief of Staff Klain.  Also, two potential Biden cabinet members were at the event, Eric Schmidt and Meg Whitman.

"We've become, now, an oligarchy instead of a democracy. I think that's been the worst damage to the basic moral and ethical standards to the American political system that I've ever seen in my life." -- Jimmy Carter

Update 11-19-20:   Erin Brokovich wrote a letter to President Elect Joe Biden chastising him for putting a former DuPont consultant on his EPA Transition Board.  It's a different kind of PEU.

Thursday, November 5, 2020

Jack Ma's Free Speech Hurt Ant Financial IPO, Carlyle Impacted


 Reuters reported:

Corporate China's shiniest star was just days away from seeing his Ant Group list on the stock market in a record $37 billion deal, when he chose to launch a blistering public attack on the country's financial watchdogs and banks.

The regulatory system was stifling innovation and must be reformed to fuel growth, billionaire Ma told a summit in Shanghai on Oct. 24 attended by the great and the good of China's financial, regulatory and political establishment.

Stung by the attack, Chinese regulators and Communist Party officials set about reining in Ma's sprawling financial empire, culminating in the suspension of the IPO on Tuesday, two days before the eagerly awaited market debut in Shanghai and Hong Kong, the sources said.

The Carlyle Group invested in Ant Financial in May 2018 joining other investors in a $10 billion round which valued Ant at $150 billion. TechCrunch reported:

Ant would have sported a possible market valuation of more than $300 billion at its IPO price. Such a valuation would rank it amongst the most valuable companies in the world.

Carlyle's double is delayed at least six months according to FT.

The Carlyle Group's co-founder David Rubenstein built his vast fortune catering to the world's political elite, even employing some of them.  Will Rubenstein try to smooth over Ant Financial's turbulent waters?  Might he coach Jack Ma in the art of apology, given his history with Carlyle Capital Corporation and an angry Kuwait SWF?  

It will be interesting to see how much Ma's honesty costs Carlyle in the end.  

Update 11-12-20:  Chinese President Xi pulled Ant's IPO according to the WSJ.  That will take some serious apology horsepower.  

Update 1-21-20:  Carlyle's big payday from Ant is in jeopardy.

Update 2-9-21:   There is no timeline for Carlyle to cash in on its Ant investment.

Update 3-18-21:  Investor valued Ant Holdings at over $200 billion, down from $315 billion in the run up to the planned IPO.

Update 9-3-21:  Carlyle co-founder David Rubenstein spoke to the situation Ant Financial faces with the Chinese government in a Bloomberg interview.  He said the problem arose from entrepreneurs, like Jack Ma, becoming larger than government officials in the public sphere.

Update 9-13-21:  "Any wealthy person with an ounce of sense is keeping silent and bowing their heads, to avoid political fire, and in subservience to the Chinese Communist Party." 

Sunday, October 11, 2020

Milken Global Institute Starts 10-12


The Milken Global Institute, the U.S. version of Davos, begins tomorrow.  This is the first gathering since President Donald Trump pardoned junk bond king Michael Milken.  The theme is "Meeting the Moment."  How can those in positions of power continue to steer the system to their advantage during dual crises, a global pandemic and racial injustice?   That is the unstated objective of most Institute sponsors.  Two Institute sponsors recently admitted to breaking the law, Citadel and Citigroup

Politicians Red and Blue love PEU and the speaker list is full of high profile Republicans and Democratic names.  The Red Team has Treasury Secretary Steve Mnuchin, Education Secretary Betsy DeVos, FDA Chief Stephen Hahn and Republican political advisor Frank Luntz.  The Blue Team has a broader showing with John Kerry, Senators Mark Warner and Chris Coons, Congressman James Clyburn, and former Obama officials Eric Holder and Susan Rice.

Carlyle Group CEO Kewsong Lee will be in a panel on "Leadership:  Moving Beyond Conventional Thinking".  Moderator Andy Serwer will tackle:

Even before the pandemic, the need for agility and constant innovation had become evident as technology disrupted every sector. How can you foster entrepreneurial spirit within corporate structures and ensure creative destruction? And how can leaders motivate others to embrace the need for constant transformation?

The Carlyle Group schooled on COVID-19 via its Chinese medical holdings and began to compile a coronavirus portfolio in February.

Carlyle affiliates can conduct retrospective studies on COVID-19 (TriNetX), disinfect surfaces (Victory Innovations), screen airports for people with fever (Schneider Electric & HGH), test for COVID antibodies (Ortho Clinical), assist with blood plasma collection (MAK Systems), produce antibody drug conjugate (Piramal Pharma Solutions), ensure the maximum hospital bill for COVID-19 patients (TrustHCS), manufacture Ivermectin treatment (SeQuent Scientific) and make federal coronavirus purchasing something other than a clown show (Unison).  Coronavirus tea leaves suggest more PEU profits to come.

The Milken Global Institute will continue enriching the rich and empowering the powerful.  It's the PEU way.

Update 10-13-20:  Apollo founder Leon Black sent a letter to investors expressing his regret for associating with Jeffrey Epstein. 

Update 10-14-20:  Treasury Secretary Mnuchin commented on the stimulus package delay from Milken Global Institute.  Dealbook reported how private White House meetings helped the greed and leverage boys make big money as the pandemic hit the U.S.

Update 10-17-20:  Vista Equity founder Robert Smith reached a $140 million settlement with the Justice Department for tax evasion.  More greed from the PEU boys.

Update 10-28-20:  More problems at Vista Equity Partners from the firm's PEU ways.  Fed money for Main Street goes unused as the PEU boys run dividend recaps on affiliates, debt for sponsor dividends.  Insider trading is rampant with no accountability or oversight.

Friday, September 25, 2020

Carlyle Adds Two COVID-19 Investments, TriNetX and Victory Innovations

 

The Carlyle Group added disinfecting equipment maker Victory Innovations and research organization TriNetX to its substantial coronavirus profit portfolio.  The private equity underwriter (PEU) took a majority stake in both firms and did not share transaction details.

TriNetX raised $40 million in March 2019 to fund growth.  March 2020 saw the coronavirus hit the U.S. Northeast hard.   

TriNetX enables researchers to apply a data-driven approach to health research by providing web-based, on-demand access to harmonized global electronic health record (EHR) and claims data


TriNetX sounds similar to recently disgraced Surgisphere, which withdrew a COVID-19 paper from The Lancet due to data intergrity questions.  Science reported:

Surgisphere founder Sapan Desai publicly aspired to combine big data and artificial intelligence (AI) in ways that he said can replace randomized controlled clinical trials. For a brief moment, it seemed that Surgisphere’s enticing data set, said to include nearly 100,000 detailed patient records from about 700 hospitals on six continents, would settle questions about the possible benefits of various drugs—including the controversial antimalarial hydroxychloroquine—for COVID-19 patients. 

Carlyle's press release quoted TriNetX CEO Gadi Lachman.

CEO Gadi Lachman added "To accomplish this we need to continue to develop solutions to support clinical research at our healthcare organizations and bring more global data and technologies such as AI, machine learning and analytics to researchers so that they can ask more questions and generate more real-world evidence. Carlyle's investment accelerates our growth plans and will shorten the time it takes to turn our vision into reality." 

Carlyle schooled on the coronavirus via its Chinese medical holdings.  President Trump's lingering inaction means many more cases to come, thus more Carlyle Group profits.  

Carlyle affiliates can conduct retrospective studies on COVID-19 (TriNetX), disinfect surfaces (Victory Innovations), screen airports for people with fever (Schneider Electric & HGH), test for COVID antibodies (Ortho Clinical), assist with blood plasma collection (MAK Systems), produce antibody drug conjugate (Piramal Pharma Solutions), ensure the maximum hospital bill for COVID-19 patients (TrustHCS), manufacture Ivermectin treatment (SeQuent Scientific) and make federal coronavirus purchasing something other than a clown show (Unison).  Coronavirus tea leaves suggest more PEU profits to come.

Sunday, September 6, 2020

Rubenstein's PEU Life: How to Greed


Carlyle Group co-founder David Rubenstein authored the book "How to Lead:  Wisdom from the World's Greatest CEOs, Founders and Game Changers."  Rubenstein pioneered private equity, the practice of buying companies with borrowings and flipping them for huge gains on the initial equity investment.  He helped innovate the offering of additional debt for an affiliate company in order to pay Carlyle a monster dividend.  His achievements in the greed arena are not in his book

“I’m not a journalist,” Rubenstein says. “My job is not to ask questions that might embarrass somebody … people can judge whether that’s a good or bad thing.

“The people that I interview are people that I have known, generally, for a reasonably long time. So the appeal of it is they feel comfortable with me, and they might be willing to say some things they might not to a professional journalist. And here’s the cost of that: I won’t ask the embarrassing questions, because they won’t expect it from me.

Rubenstein does not ask the tough questions because he does not allow such questioning in his financial media interviews.   Secretary of State Mike Pompeo told Rubenstein in a friendly chat:

Trump is “very focused on where the money is, and how we use economic leverage to achieve our diplomatic ends”.

Rubenstein has a laser like focus on the money, as well.  His ex-wife gave a less than charitable assessment while they were still married:

In 2016, Rubenstein gave the National Park Service $18.5 million to help restore the Lincoln Memorial. In private, Alice Rogoff Rubenstein has described those acts as publicity grabs and claimed all her financier husband really cares about is making money. 

Supreme Court Justice Ruth Bader Ginsberg quoted Judge Learned Hand:

‘If the fire dies in the hearts of the people, no constitution and no judge can restore it.’ My faith is in the spirit of liberty.”

Private equity crushed the hearts of many people.  Consider this 2011 statement from a journalist with a major financial media company.

I have seen so many people -- particularly those in their 50s - 70s -- taken apart by what has happened in their industry as greed has hollowed out the economy. These are people took pride in their jobs and held themselves to this invisible standard that we all just took for granted, but is being wiped out.

The Carlyle Group scares me more than anything I've ever seen on Wall Street. It seems to exist to corrupt politicians and it's hard to know who they even represent.

I watched a video interview of (David) Rubenstein and his arrogance is really beyond tolerance. He was going on about the debt ceiling problem and how there would need to be cuts in services and higher taxes. When the reporter asked him about tax on carried interest he turned really disdainful and said that this "only" amounted to $22 billion over some number of years and this was not serious money. Boy, nothing like everybody doing their small part to save the country from oblivion!

Carlyle's David Rubenstein fought very hard over more than a decade to keep private equity's preferred taxation. There is another book to write about the greed and leverage boys and the damage they've done to the spirit of our country.   

Rubenstein recently said private company CEOs are realizing they won't need as many workers as they once thought.  That is part of Carlyle's PEU insight, marketed as OneCarlyle.  Rubenstein ignored Yahoo Finance's Andy Serwer when asked if he would donate to any groups helping millions of unemployed Americans.   

For decades Carlyle has counted on the U.S. government and officials in both political parties.  The financial media learned long ago not to challenge Rubenstein.  His billionaire status, patriotic philanthropy connections and authorship have his face all over the general media.

I don't know how you write a book on leadership and. when asked. not eviscerate Donald Trump for failing to meet the basics of compassion, empathy, integrity and competence.   David Rubenstein can.

Sunday, August 23, 2020

Trump Keeps Carlyle's Convalescent Plasma Profit Hopes Alive


President Donald Trump announced that convalescent plasma would continue as a therapeutic drug for COVID-19.  Several days ago weak data from randomized control trials raised concerns as to whether the treatment would receive emergency authorization.

The Carlyle Group has plasma play MAK Systems, a blood products software company.  Carlyle's Piramal Pharma Solutions makes antibody drug conjugate.

I expect Carlyle lobbied hard to overcome NIH's recommending the FDA delay allowing the use of convalescent plasma.  Carlyle co-founder David Rubenstein's phone call is one any U.S. President would take.

The day before Trump's announcement he attacked deep state operatives in the FDA for holding up treatments and vaccines.