Saturday, April 24, 2021

Youngkin Worth Over $300 Million

Carlyle Group Co-CEO Glenn Youngkin officially resigned on September 30, 2020 to follow the call of public service.  Youngkin hopes to land the Republican nomination for Virginia Governor.  

Youngkin left Carlyle's platinum handcuffs, surrendering unvested shares of company stock from various pay programs.  

We have historically relied in part on the interests of these professionals in the investment funds’ carried interest and incentive fees to discourage them from leaving the firm

After 25 years public service called.  SEC filings showed Youngkin had as many as 8.9 million shares of Carlyle stock, vested and unvested.  After his retirement Carlyle records show him with 6.7 million shares.  It's not clear if Youngkin sold any stock between his retirement and Carlyle producing the 2021 SEC filing. 

Youngkin's 6.7 million shares were worth over $275 million yesterday. Private equity professionals are known for investing alongside limited partners, for having a "stake in the game."

In addition to his over $275 million in Carlyle stock Youngkin has personal funds invested alongside Carlyle Group investors.

The amount invested in and alongside our investment funds during 2018 stood at $14,272,206 for Mr. Youngkin.   

Certain of our directors and our executive officers (and their family members and investment vehicles) also made additional commitments to our investment funds during 2018.  Total unfunded commitments as of December 31, 2018 were $73,754,891 for Mr. Youngkin.

The amount invested in and alongside our investment funds during 2019 rose to $16,667,781 for Mr. Youngkin.  

Total unfunded commitments of our directors and executive officers (and theirfamily members and investment vehicles) to our investment funds as of December 31, 2019 was $78,307,824 for Mr. Youngkin.

The amount invested in and alongside our investment funds during 2020 rose to $18,582,584 for Mr. Youngkin.

Total unfunded commitments of our directors and executive officers (and theirfamily members and investment vehicles) to our investment funds was $65,724,694 for Mr. Youngkin.

Candidate Youngkin has a personal reason to protect private equity's preferred taxation of carried interest.  Carlyle filings state:

If the U.S. Congress or state, local or certain foreign governments enacted legislation to treat carried interest as ordinary income rather than as capital gain for tax purposes or impose a surcharge on carried interest, this could result in a material increase in the amount of taxes that our carry recipients would be required to pay.

As of 2020 Carlyle reported Youngkin had $16.7 million in carried interest .  Youngkin also received $8.5 million for his partnership units.

That adds up to $305 million from his Carlyle holdings.  Youngkin earned a combined $12 million in compensation outside stock awards from Carlyle for 2018 and 2019.  He had twenty five years to use his wealth to acquire/grow other assets, homes, cars, retirement accounts and other financial investments.  

Virginians will find out Youngkin's worth when he files financial disclosure forms, should he win the nomination and general election.  He could release his tax forms, which would provide insight as to Youungkin's finances.  

Update 4-30-21:  Youngkin is clearly part of the top 0.1% which has outsized influence on government from the outside.  Youngkin wants to serve the PEU class from the inside as Virginia governor.

Update 9-29-21:  Forbes wrote about Youngkin's finances.

Friday, April 23, 2021

Youngkin's Jobs Record Questionable in Texas

Former Carlyle Group co-CEO Glenn Youngkin cited his business background as qualifications for him to serve as the Republican nominee for Virginia Governor. 

“It’s important to provide all Virginia citizens with the opportunity to pursue a career,” Youngkin said. “Carlyle started as a small company and has grown into a large company.”

“What I learned in the process is that if you make a false promise and don’t fulfill it … you don’t understand how to solve various problems … you won’t succeed as a business or leader. Let’s do it." 

Youngkin served as the Global Head of the Industrial Sector investment team from 2005-2008.  During this time Carlyle affiliate Vought Aircraft sent promised jobs from Texas to South Carolina.  It reclassified $35 million in Texas taxpayer funding from "operating" to "financing activities".

Vought employed 3,350 people in the Dallas area when the grant was awarded in 2004.  At the end of the six year period Vought employed 3,315 around Dallas-Fort Worth, a decrease of 35 jobs.  

The Carlyle affiliate had $35 million in public money for six years and cut 35 positions.  That's $1 million per job lost.  

Carlyle Group owned Vought Aircraft made promises to Texans which they failed to meet.  The question is how did Glenn Youngkin touch this jobs debacle in his various roles at Carlyle.  He was high enough, COO, CFO and Industrial Sector Chief to have touched this issue.

From 2011 until May 2014, Mr. Youngkin was Carlyle’s Operating Officer. From October


2010 until March 2011, Mr. Youngkin served as Carlyle’s interim principal financial officer. From 2005 to 2008, Mr. Youngkin was the Global Head of the Industrial Sector investment team.   

Vought needed capital in 2006 to ramp up Boeing 787 production (promised Texas jobs that went to South Carolina).  Surely Youngkin became aware of this situation as Vought needed more investment to adequately serve Boeing. 

Last October, Vought CEO Elmer Doty acknowledged that Vought was the highest-risk supplier on the 787 industry team. At the time, Doty attributed Vought's struggles to an internal liquidity crisis in 2006 that prevented the company from ramping up investment in the 787 programme at a sufficient rate.

In 2007 Doty told the Dallas Business Journal:

To his disappointment, Doty added in an April 17 interview with the Dallas Business Journal, expanding in Dallas is unlikely, as are plans to buy the old Naval Air Station from the U.S. Navy. So a $35 million cash grant in 2004 from Gov. Rick Perry's Texas Enterprise Fund most likely will be repaid

Three years before the grant period ended Carlyle knew they would not add Vought jobs in Texas.

Youngkin says he is about promises and jobs, yet his former employer and Texas Governor Rick Perry (R) have egg on their face in both arenas.  

At age 15 Youngkin got a job washing dishes in a diner in Virginia Beach, before he "worked his way up to flipping eggs."  

Glenn is still flipping.  Virginia voters beware, some may land on your face.

Thursday, April 22, 2021

Ex-Carlyle Group CEO Youngkin Seeks Va. Governor Nomination

Glenn Youngkin spent twenty five years working for The Carlyle Group, a politically connected private equity underwriter (PEU).  Youngkin rose through the ranks, ending up as co-CEO.  

Youngkin retired from Carlyle last year to pursue political opportunities.  He currently is seeking the Red Team's nomination for Governor of Virginia as a "new kind of leader."

"I spent the last 30 years building business, creating jobs, and bringing people together to succeed. Guided by my faith, I will bring that same dedication to serving Virginians."

His record shows Glenn served on the board of Brazilian lingerie company Scalina and an early investor in the Professional Fighter's League.

His bio reveals: 

From October 2010 until March 2011, Mr. Youngkin served as Carlyle’s interim principal financial officer. From 2005 to 2008, Mr. Youngkin was the Global Head of the Industrial Sector investment team. From 2000 to 2005, Mr. Youngkin led Carlyle’s buyout activities in the United Kingdom and from 1995 to 2000, he was a member of the U.S. buyout team. Prior to joining Carlyle in 1995, Mr. Youngkin was a management consultant with McKinsey & Company and he also previously worked in the investment banking group at CS First Boston.

During Youngkin's tenure Carlyle hired many ex-politicians, including former British Prime Minister John Major  Major's hiring occurred while Youngkin led Carlyle's PEU activities in the U.K.

As Global Head of the Industrial Sector Team Youngkin oversaw the movement of U.S. jobs to China.  Consider United Components (UCI) which Carlyle owned from 2004 to 2010.

When Carlyle purchased UCI it had no Chinese subsidiaries.  By 2010 UCI had thirteen subsidiaries in China or Hong Kong.  The number of employees fell from 6,900 to 4,350.  Carlyle pulled $35.3 million from UCI via a special dividend in 2007.   Add their $2 million annual management fee and the total rises to $47.3 million.  How many U.S. jobs did The Carlyle Group send to China outside UCI?

UCI's is but one story Carlyle sending American jobs overseas.   Nature's Bounty had no Chinese facilities when The Carlyle Group bought the company in 2010.  The company took a $35 million jobs package from Long Island to relocate jobs from China and other U.S. facilities.

China. -- As of September 30, 2013, our subsidiary, Ultimate Biopharma (Zhongshan) Corporation ("Ultimate") owned in Zhongshan, China: a 50,000 square foot facility for manufacturing softgel capsules and for administrative offices, a recently built 75,000 square foot warehouse facility with packaging capabilities and 18.5 acres of vacant land adjacent to the manufacturing facility. In addition, Ultimate leased 11,300 square feet of dormitory space and 4,800 square feet of warehouse space in Zhongshan City. Also, one of our subsidiaries leased 84,800 square feet of warehouse space in Beijing. 
Note Nature's Bounty had no manufacturing facilities in China in its final 10-K filing before Carlyle's 2010 buyout. 

At the 2012 World Economic Forum in Davos, Carlyle co-founder David Rubenstein expressed his preference for the Chinese totalitarian model of central planning.  Rubenstein offered a dark vision for those not adhering to his advice.

"Our children are going to have and our grandchildren are going to have" a lower quality of life and a less affluent lifestyle than we enjoy today

In many ways PEU Rubenstein made his vision a reality with help from his Co-CEO Glenn Youngkin.  The greed and leverage boys used to hire former politicians.  Their innovation is to send PEUs into the political arena and pretend they didn't send millions of jobs overseas.  

Youngkin is running in the complicated Republican gubernatorial convention to be held on May 8th. The convention will have multiple voting sites, ranked-choice voting, an unlimited number of delegates and weighting by locality.  It's as simple as PEU return on equity calculations. 

Youngkin spoke against high taxes and said that he will “revitalize, reinvigorate and rebuild Virginia’s economy like never before.”

The tax avoidant billionaire class can count on Youngkin. 

Wednesday, April 21, 2021

PEU Super League Implodes


Manchester United owner Joel Glazer tried to undo the damage done to European football from the proposed Super League, which collapsed after all six English clubs withdrew.   Glazer owned ManU since 2005 and communicating with fans and building trust has not been a priority.  Making money has and that was the premise behind the Super League.

La Liga President Javier Tebas said:

“The Super League has made a fool of itself and its concept has shown the absolute ignorance of its leaders in relation to the industry and fans across the globe. When you do something in secret, what you’re hiding usually isn’t good.”

The PEU boys purposely work in secret while manipulating existing political structures to their advantage.  The Carlyle Group located in Washington, D.C. for that very reason.  While Carlyle was not involved in the announced Super League (financed by JP Morgan) its Co-CEO Glenn Youngkin helped start the Professional Fighters League from the ashes of the World Series of Fighting.  Youngkin retired from Carlyle and is currently a candidate for Virginia Governor, aiming for the Red Team's nomination.  

Stakeholders took down the greed-inspired PEU Super League.  What will Virginia voters do?

Update 3-3-22:  The Carlyle Group will finance a PEU buyout of Italy's Atalanta Football Club.  Bain Capital et al will have a majority stake in the firm that owns 86% of the club.  As usual they have insiders leak the information while officially staying mum.  They will takeover one club at a time.  When they have enough they will push the Super League once again.

Tuesday, April 20, 2021

Carlyle Exits Ithaca Holdings

Korea Bizwire reported:

Hybe, the company behind K-pop phenomenons BTS, announced Friday a deal to buy a 100 percent stake in American music entrepreneur Scooter Braun’s Ithaca Holdings.

Under the deal, Hybe — formerly Big Hit Entertainment — will be acquiring the media company, which owns affiliates like SB Projects, founded by Ithaca chief executive Scott “Scooter” Braun and Big Machine Label Group, the company said in a statement.

In a separate regulatory filing, the company said it plans to buy the 100 percent stake in Ithaca Holdings for US$1.05 billion via its U.S. subsidiary Big Hit America Inc. The company will fund Big Hit America for the deal, which will increase its capital by 1.07 trillion won.

The Carlyle Group invested in Ithaca Holdings in 2017.  Carlyle's minority stake gave the private equity underwriter (PEU) a voice in Ithaca's secret purchase of Taylor Swift's music catalog.  

Carlyle co-founder David Rubenstein and co-CEOs Glenn Youngkin and Kewsong Lee ignored Taylor Swift's plea for help in acquiring the rights to her music from Ithaca.  She fired a shot over the PEU bow with her song "The Man."

Ithaca floated a Taylor Swift live album that bombed without the singer's endorsement  That motivated Ithaca and Carlyle to flip Taylor's music collection before she could begin re-recording her old music  

The PEU did not give Swift a chance to bid on her music, instead requiring buyer Shamrock Holdings to not communicate with Taylor until the deal was consummated. 

Taylor recently re-released her album Fearless and asked her loyal fans to bury the old versions of her songs on Spotify.  Swift's Fearless broke a record held by The Beatles for fifty four yeas.

Taylor has topped the Fab Four by making chart history with the re-release of "Fearless." Here's the chart history part ... the album hit #1 Friday in the UK, and with that Taylor has racked up 3, number-1 albums in 259 days. The albums ... "Fearless," "Folklore" and "Evermore." The Beatles hit #1 with 3 albums in a row, but it took them 364 days.

The Carlyle Group's investment in Ithaca Holdings is not clear

As part of the transaction, private equity firm The Carlyle Group is exiting its significant minority stake in Ithaca after initially investing in the company in 2017 by way of its Carlyle Partners VI fund.

Carlyle reported in June 2019:

The Carlyle Group, which initially invested in Ithaca in 2017, is supporting the (Big Machine) transaction, alongside Scooter Braun and Ithaca Holdings, through an additional equity investment by way of its Carlyle Partners VI fund. Carlyle will remain a minority shareholder in Ithaca and continue to support the combined company’s growth strategy with Jay Sammons, Head of Carlyle’s Global Consumer, Media and Retail team, remaining on Ithaca’s Board.

Business Insider reported:

Carlyle's involvement in Braun's $300 million deal to buy Big Machine is complex, but at the time the deal was announced, the group said it was "supporting" Braun, and his company Ithaca Holdings, in their purchase of Big Machine, which also owns the rights to music by country star Rascal Flatts.

Carlyle first invested in Ithaca Holdings in 2017, and according to a June story from The Wall Street Journal, Ithaca is now valued at $800 million.

Ithaca went from $800 million to at least $1.35 billion, the $1.05 billion from the sale of the company to Hybe and the $300 million from selling the Swift catalog to Shamrock Holdings.  That's a two year return of 68.75%.  Carlyle's return on equity is likely much greater, thanks to leverage.  Another PEU payday!

Monday, April 19, 2021

PEU Boys Storm European Football's Top Echelon

Bloomberg reported:

Organizers are finalizing details of an alternative to the prestigious UEFA Champions League, in which a group of at least 10 marquee teams -- including Manchester United and Real Madrid -- would play each other, according to people familiar with the situation. An announcement could come as soon as this week, said the people, asking not to be identified because the information is private.

Establishing a new elite competition (Super League) in Europe would effectively end the Champions League’s decades-long reign as the world’s premier club contest, upend the sport’s structure, and funnel billions of dollars into the upper echelons. Founding teams would share an upfront payment of 3.5 billion euros ($4.2 billion), according to a planning document seen by Bloomberg News.

JPMorgan Chase & Co. is in talks to provide financing for the project based on the expectation of future television revenues, people familiar with the matter said previously.

The Guardian reported:

Former Football Association and Manchester City chairman David Bernstein said he was ashamed of his old club and the creation of the new league showed the desperation of club owners who had built up huge debts.

“There are two things in play here, one is greed and the other is desperation because some of these clubs … have incurred enormous debts, certainly Barcelona and Real Madrid and at least one of the English clubs who shall remain nameless are approaching £1bn of debt,” he told BBC Radio 4’s Today programme. “It’s a lifeline that is going to end, if it happens at all, very badly.”

Private Equity Insight reported in November 2020:

CVC Capital Partners and Advent International want to add a “breakaway” clause to their €1.6bn deal to buy into Italy’s Serie A football competition to protect their investment if a rival European super league is launched.

The two private equity firms are part of a consortium with Italian investment fund Fondo FSI that is hoping to buy 10 per cent of a new company that will manage the broadcasting rights for Italy’s top football division.

That deal is in its final stages, but has been complicated by last month’s revelations that some of Europe’s biggest clubs are in discussions to create a new continental competition that could threaten the primacy of national leagues.

International investors have become increasingly interested in European domestic football leagues — which have suffered significant losses during the pandemic — because of the huge global audiences and valuable broadcasting rights. Private equity firms have approached Germany’s Bundesliga and Spain’s La Liga in recent weeks.

Who knew European football was a distressed asset and needed to be stormed by the greed and leverage boys?   Unherd reported:

The biggest irony is the attempt by a bunch of American owners to create a closed shop in European football.

Closed shop, valuable broadcasting rights, outsized's the PEU way.  Micheal Every of Rabobank gave the Super League a Red Card.

IT’S RED!” A straight red card for Global Neoliberalism United, that is. 12 of Europe’s top football (‘soccer’) clubs are planning to break away from their already-lucrative elite domestic leagues, and their even-more lucrative Champions League, in order to form a breakaway closed-loop European Super League with no relegation and no cup competitions. In short, the richest (if not most successful) clubs, and the world’s most famous players, are potentially about to walk away from the entire global system of football - including the quadrennial World Cup - to keep all of the global money in the game rather than sharing just a little of it with others: this is of course backed by Wall Street and private equity to the tune of USD8bn.

PEU's expect special treatment, like carried interest taxation granted in the United States.

Update 3-3-22:  The Carlyle Group will finance a PEU buyout of Italy's Atalanta Football Club.  Bain Capital et al will have a majority stake in the firm that owns 86% of the club.  As usual they have insiders leak the information while officially staying mum.

Monday, April 5, 2021

PEU Hires Israeli Spy Firm that Specializes in PEUs


Black Cube, a secretive Israeli investigative firm, sought to embarrass a judge who made an unfavorable ruling against a financial-firm client for a fee of as much as $11 million, according to an Ontario court ruling.

The client, Toronto private-equity firm Catalyst Capital Group Inc., agreed to pay the fee to Black Cube, which dispatched agents to discredit a Canadian judge and a rival firm in an effort code-named “Project Maple Tree,” the ruling said.

Black Cube's website states:

Black Cube offers fast and accurate intelligence and analysis services for hedge funds, private equity firms and large investment houses who require investigative research on their investment opportunities.

The greed and leverage boys are policy making billionaires.  How many of those policies came from espionage style dirt on elected officials?