Carlyle Flees China Fishery Board

DealStreetAsia reported:

Private equity major Carlyle Group is no longer part of the board of Singapore-listed industrial fishing company, China Fishery Group. 

Carlyle had recently declined to take part in China Fishery Group’s rights issue, and this had led to the private equity firm’s stake in the fishing company being reduced to 6.2 per cent from 11.1 per cent earlier.

This development comes even as China Fishery is being investigated by the regulators – Monetary Authority of Singapore and white-collar crime busters Commercial Affairs Department – for an offence under the Securities and Futures Act. 

On August 21, shares of China Fishery Group, fell more than 50 per cent, after news broke that the company was under investigation in Singapore and Hong Kong. A recent Bloomberg report said the probe into China Fishery Group Ltd for a securities offense had wiped out some $600 million from group shares and its US currency bonds. 

China Fishery Group, in a regulatory filing on Monday said that Carlyle’s Patrick Siewert has stepped down as non-executive director of the company with effect from 29 August, 2015.

Carlyle's press release stated when the deal was struck in 2010:

"Carlyle’s strategic investment strengthens our shareholder base and further enhances our corporate governance and social responsibility practices. China Fishery is committed to managing its activities in a responsible and sustainable manner...  In addition to the new capital that will help fuel our expansion plans, China Fishery can also benefit from leveraging Carlyle’s extensive network, acquisition and financing expertise and strategic insights. With Carlyle’s guidance and contributions at the Board level, we look forward to taking China Fishery to greater heights and delivering sustainable growth in shareholder value.”

After more than five years of governance service Patrick Siewart fled the sinking ship's board.   We'll see how strategic a move it was should more information be revealed regarding the investigation.  Carlyle's good name must be maintained. 

Update 10-28-15:  Moody's downgraded China Fishery's debt.

Carlyle to Round Trip Landmark Aviation for Second Time

The Carlyle Group might get frequent seller points for putting Landmark Aviation on the selling block once again.  In 2007 Carlyle sold affiliates Landmark Aviation and Standard Aero to Dubai Aerospace for $1.8 billion.  Today Carlyle wants to move Landmark Aviation for $1.7 billion.

The quiet 2007 sale came between two public uproars over Dubai companies buying U.S. ports and the NASDAQ stock exchange.  Carlyle likes to monetize assets at top valuations.  The private jet set has had a great twenty year run.  One can only hope the winds turn and lift the finances of the little people at the expense of the greed and leverage boys.

My vision of Carlyle chiefs boarding their last Landmark owned flight has the attendant saying, "PEU class, step this way.  At your seat you'll notice a program for the World Economic Forum in Davos and a personal sized set of handcuffs and leg chains.  Let's hear some clicking boys."

Update 9-23-15:  Carlyle will get over $2 billion for Landmark from BBA Aviation   The deal merges the #1 FBO operator in the U.S. with Landmark at #3.  I expect the "Just Us" Department and Treasury (CFIUS) to do their usual PEU double stamp of approval. 

Malaysians Smell PEU

BBC reported:

Tens of thousands of Malaysians are protesting in the capital Kuala Lumpur and elsewhere, calling for Prime Minister Najib Razak to step down over a financial scandal. 

Protesters are angered by a $700m (£455m) payment made to his bank account from unnamed foreign donors. 

It was discovered last month during a probe into alleged mismanagement at the debt-laden state fund 1Malaysia Development Berhad (1MDB).

The article illuminated 1MDB:

What is 1MDB? 
• The 1Malaysia Development Berhad state investment fund was established under Prime Minister Najib Razak in 2009 to transform Malaysia into a high-income economy. 
• Critics say the fund overpaid for many of its investments and spent millions on fees to investment bank Goldman Sachs 
 • It began attracting attention at the end of 2014 when it started missing payments to creditors. It later emerged that the fund was mired in $11bn (£7bn) of debt. 
• Mr Najib has been accused of taking $700m from the fund - a charge which he has denied. 
 • Malaysia anti-corruption commission said it had verified that the money was a donation from unnamed foreign donors.

Malaysia's sovereign wealth fund started after the 2008 financial crisis. With the help of Goldman Sachs it took on $11 billion in debt.  The elected official who established the fund received $700 million from foreign donors yet to be identified.

No wonder masses hit the streets of Kuala Lumpur.  They're protesting the greed and leverage boys, which includes private equity underwriters, imitators like 1MDB and their sponsored politicians. 

Update 9-7-15:  Goldman's fee-a-palooza on 1MDB stinks to the average Malaysian.

Carlyle Buys Analytics Provider Novetta

Mergers+Acquisitions reported:

The Carlyle Group LP (Nasdaq: CG) has agreed to buy cybersecurity data firm Novetta from Arlington Capital Partners.

Arlington formed Novetta in 2012 when it merged portfolio companies White Oak Technologies and FGM Inc. Novetta provides cybersecurity data analytics for government agencies include the Department of Defense and the Department of Homeland Security.

Carlyle has long loved Uncle Sam's Treasury and is skilled at reading the tea leaves of government spending.

Carlyle Managing Director Julius Genachowski serves on President Obama's two intelligence boards, so he is in a unique position to see government intelligence needs and advise Carlyle's triumvirate to invest accordingly.  His bio on Carlyle's website stated:

Mr. Genachowski has long advised President Obama on technology issues. 

Julius could've made President Obama's intelligence tea.  That would be an investment sweet spot for a private equity underwriter (PEU).

Carlyle is making the investment out of the firm’s $13 billion Carlyle Partners VI fund. The firm made another software deal earlier this year when it announced plans to buy Symantec Corp.’s Veritas data storage business for $8 billion.

Uncle Sam must need kajillions of storage for its aim to monitor every citizen 24/7 and a Carlyle affiliate will do so for grand returns. 

The question is who Novetta will work for, the general public or the protection of American branded global greed and power class?  Novetta's first test could be finding out who really initiated Hunter Biden's Ashley Madison account.  

Update 9-24-15  Financing for Carlyle's Novetta deal is covenant lite.  

Biden Hunting on Ashley Madison?

Hunter Biden blamed Russian agents for setting up a fake Ashley Madison account in his name.  How the Russians did this from Biden's office at Georgetown University is unclear.  Biden's people have no comment.

Has anyone run the credit card number used to set up the account?  That might clear up who set up Hunter Biden's Ashley Madison account. 

Cobalt Energy Sells Contentious Angolan Offshore Oil Field

Carlyle Group affiliate Cobalt International Energy sold its equity interest in an Angolan offshore oil field to partner Sonangol.  Bloomberg's piece did not mention Cobalt's 2010 deal had two shady partners, which kicked off a SEC investigation.  Cobalt offered flimsy excuses for what was likely bribery.  Last year they defended the company by saying the two illicit groups are no longer partners in the deal.  Cobalt's SEC filing did not indicate what remuneration Angolan government officials received from transferring their 30% and 10% interests in the block. 

On August 26, 2014, we received documentation confirming that Nazaki Oil and Gaz ("Nazaki") and Alper Oil Limitada ("Alper") are no longer members of the contractor group of Blocks 9 and 21 offshore Angola. Pursuant to a series of Executive Decrees passed by the Republic of Angola, the working interests previously held by Nazaki and Alper in Blocks 9 and 21 have been transferred to and are now held by Sonangol P&P. As a result, we no longer have any relationship with Nazaki or Alper. The contractor groups for Blocks 9 and 21 offshore Angola now consist only of Sonangol P&P (60% working interest) and the Company (40% working interest). Our obligation to carry and pay for Alper's 10% working interest terminated immediately with the transfer of Alper's interest to Sonangol P&P pursuant to the terms of our 2010 agreements with Alper. 

The Carlyle Group's recent SEC filing shows a 35 million share stake in Cobalt International Energy.  The illicit partnership is gone as is Cobalt's equity interest in Angolan offshore oil fields.  Will Obama's SEC consider this cleaned up?  Highly likely.  

Pensions Exiting Claren Road

Texas and California pension funds have or will redeem their investment in The Carlyle Group's Claren Road hedge fund, according to Pensions&Investments.  North Carolina and Illinois pensions are closely monitoring the situation for possible withdrawals.

SeekingAlpha reported "Carlyle will write off up to $175M of the remaining $216M value of Claren Road still on its books.  The fund's managers are hearing from exiting investors and are in the process of deciding on a future path, including maybe shutting the doors."  Claren Road may be one crowded exit.