Wednesday, May 26, 2021

Carlyle Adds to COVID Portfolio with Vectura Pharma


The Carlyle Group announced its intended purchase of Vectura Pharmaceuticals, a maker of inhaled medications.  Bloomberg reported Vectura is working on COVID-19 medicine.

A study on treatments for COVID-19 long hauler stated:

“long-haulers” or individuals with Long COVID – experienced symptoms and complications beyond the initial period of acute infection and illness like difficulty breathing or pulmonary diffusion abnormality, for months following the onset of infection. For asthma sufferers with known or suspected COVID-19, breathing difficulty can be particularly debilitating making finding treatments that can be conducted safely at home an additional concern. 

BioSpace reported:

While there are a myriad of symptoms associated with the illness often referred to as long COVID, including brain fog and fatigue, a large number of the therapies currently in development are geared toward the lasting lung fibrosis and respiratory problems.

Seeking Alpha stated:

Vectura makes drug delivery solutions for inhaled pharmaceuticals. It has 13 key inhaled and 11 non-inhaled products marketed by partners with global royalty streams, and a "diverse partnered portfolio of drugs in clinical development."

The company's in-market products include Seebri, Breezhaler and Neohaler, a DPI device and bronchodilator; AirFluSal Forspiro for the treatment of asthma and chronic obstructive pulmonary disease (COPD); Breelib for the treatment of pulmonary arterial hypertension; Relvar Ellipta/Breo Ellipta that is used in treating asthma and COPD; and Incruse Ellipta, Anoro Ellipta, and Trelegy Ellipta for the treatment of COPD. It is also developing VR315 (US) for the treatment of asthma and COPD.In addition, the company offers dry powder inhalers, pressurized metered dose inhalers, and nebulized devices.

Carlyle built a robust COVID-19 portfolio since February 2020.  Vecture appears to be its latest addition. 

Vectura has a mere $5.7 million in debt and employs 502 people.  These can change dramatically after private equity underwriters take over.  The greed and leverage boys have plans to profit handsomely from Murano Bidco and  COVID long haulers.

Update 7-10-21:  Philip Morris outbid Carlyle for Vectura.   Carlyle bought vaccine and gene therapy maker Unchained Labs to add to its COVID-19 portfolio.  

Update 8-16-21:  Carlyle increased its bid, but so did Philip Morris.  Vectura's board selected Philip Morris as the winner. 

Monday, May 24, 2021

Ivanka Latest to Get Boardroom Fog

Ivanka Trump is the latest executive to show boardroom fog in the midst of a civil or criminal investigation.  She was unable to recall the title of a fellow Trump Organization executive.  Her answer to "Who is Allen Weiselberg?"

“He is the — I would have to see what his, his — I don’t know his exact title but he’s an executive at the company.”

Recall Ivanka is employed by the Trump Organization and consulted for the company to the tune of almost $750,000. 

Forbes wrote:

In recent years, Ivanka has led the Trump Organization on some of its biggest deals…and has been given credit by those she’s negotiated with for her diligence and hard work.

Her father said "Ivanka specializes in acquisitions and design."  One of Ivanka's acquisitions was Trump Hotel in Washington, D.C.  The investigation targeted stratospheric hotel rates during Trump's inauguration.

Ivanka would have been paid by Allen Weiselberg.  Her expenses would've been reimbursed by Allen Weiselberg.  She would have negotiated deals with input from Allen Weiselberg.  

Her inability to "recall" Allen Weiselberg's title set the stage for other memory failures regarding the investigation.  This is a common practice by executives in trouble with the law.  

After a refinery explosion killed 15 people and injured 180, BP's Lord John Browne went to the Supreme Court to avoid giving testimony.  BP's executive in charge of refinery operations lost his memory under questioning from plaintiff's attorneys. 

Lord John Browne was finally deposed and appeared to be quite clueless.  BP CEO Tony Hayward also got boardroom fog after BP's giant Gulf of Mexico Oil Spew.  

Private equity underwrites like hiring smart executives after they recover from boardroom fog.  Browne went to Carlyle Group partner Riverstone Holdings.  Carlyle had its own refinery explosion in Philadelphia.  Hayward joined Vallares PLC, funded by Nathanial Rothschild.

Boardroom fog is a desirable skill of corporate chiefs, however jarring it may be to the general public.

Update 7-18-21:  The latest high profile person infected with memory fog is Jeffrey Epstein's underage girl recruiter Ghislaine Maxwell.  Maxwell "cannot even recall a single flight on Epstein's private jet with Ms Giuffre, even though flight logs show that (Maxwell) had 23 flights with Ms Giuffre while Ms Giuffre was underage."

Update 10-31-21:   Prince Andrew skipped the fog by going from straight-up denial that he sexually assaulted an underage Guiffre to impugning her character.  

Update 12-31-21:  A jury found Epstein accomplice Ghislaine Maxwell guilty of sex trafficking underage girls. 

Update 11-8-23:  Ivanka Trump testified in her father's civil trial for financial fraud.

In composed and succinct responses, she repeatedly said she did not recall specifics, or was not aware.

In this case it's Executive Vice President fog.

Update 11-12-23:  A former aide to Ivanka in the Trump White House said:

“I don’t buy that she doesn’t recall things.  Ivanka Trump is a very, very smart woman and has an amazing memory. I used to actually always marvel about that when I worked with her.”
Update 2-16-24:  As for memory problems in investigative cases the judge in Trump's civil fraud trial said of Ivanka:
"Despite being presented with ample emails and other documentary evidence demonstrating the critical role she played in the negotiation, Ms. Trump professed to have no memory of any of the events of the loan negotiation or the agreed upon terms." 
"But the court found her inconsistent recall, depending on whether she was questioned by OAG or the defense, suspect."

 

Sunday, May 23, 2021

PEU Boys Outraged by Possible Removal of Preferred Taxation


Bloomberg
reported:

In the gilded realms of private equity, where mega deals and mega paydays beckon, the masters of leveraged buyouts are feeling a little put out.

From Park Avenue to Palm Beach, the conversation keeps turning to the same uncomfortable subject: an onslaught of taxes and the closing of the Billionaires’ Loophole.

After years of idle threats, Washington is talking seriously about ending the tax break that has helped private equity become one of the most lucrative corners of U.S. finance. Adding to the injury, other taxes on income and capital gains would also rise.

Private-equity types are, predictably, outraged.

For wealthy people like them, going after carried interest -- basically, their cut of the profits -- strikes many as anti-business, if not anti-American.

Preferred taxation for the greed and leverage boys has been a fixture under America's policy making billionaires.  Private equity founders like Carlyle Group's David Rubenstein and Blackstone's Stephen Schwarzman descended on Capital Hill to stymie past attempts to rectify this gross tax inequity.

Flash back to2011 when a former major business news reporter wrote:

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!

The private equity underwriter (PEU) lobbying group aided the blitz to keep preferred carried interest taxation intact.  I referred to the earlier version as PECKER, Private Equity Capital Knowledge Executed Responsibly.  In their name change they ignored my suggestion, settling on the vanilla American Investment Council.

Private equity’s formidable Washington lobby, the American Investment Council, is willing to talk. It’s working to convince members of Congress to protect the industry’s interests.

President Biden's cabinet and White House are chock full of PEUs.   Somehow with corporate valuations at stratospheric levels and a widespread proliferation of private equity firms, the amount of incremental taxes projected decreased

Scrapping the carried interest loophole could raise an estimated $15 billion from the wealthy over 10 years, according to a congressional committee.

When push comes to shove it will be interesting to see who's voice wins.  Will it be the general public who's long wanted the obscenely rich to pay more or policy making PEU billionaires?  The public is yet to win this battle.

Friday, May 21, 2021

Rubenstein Says Cryptocurrency is Here to Stay

 

Carlyle Group co-founder David Rubenstein is one of America's policy making billionaires.  Rubenstein held off the removal of private equity's preferred carried interest taxation over the last decade through his relationships with those in power.

Rubenstein indicated cryptocurrencies are here to stay.  

“I think it’s here to stay. Cryptocurrency is not going away, just like gold is not going away. Yes, it’s had its ups and downs and [Wednesday] was not a good day for it but that’s true of anything that is relatively new. … It’s here because people in the market want something other than just the traditional currencies that we’ve had and whether that’s right or wrong, it’s clearly something that the market wants.”

If the market wants it, it gets it.  Is there no role for government regulation to protect citizens?   

He also met with President Joe Biden in his role as Kennedy Center Chairman.  I imagine President Biden said something like "David, it is good to see you again."

Rubenstein's family office, Declaration Partners, is redeveloping a $1.4 billion housing complex on Boston's Bunker Hill.  He is personally planning to invest in Africa.  

His last three guests on Bloomberg's The David Rubenstein Show were Senator Tammy Duckworth, Commerce Secretary Gina Raimondo and Fed Chief Jerome "Jay" Powell.  The last two are former private equity underwriters and likely hold some residual stake in PEU affiliates.

Greed and the lust for power has overtaken our halls of government.  The Carlyle Group led the way.  Even in retirement David Rubenstein has to have more.  The system is designed for him to achieve just that and he had a major role in that design.

Update 5-26-21:  Rubenstein's Declaration Partners has a stake in cryptocurrency broker Paxos.  Did he declare that conflict in his interview?

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.

Update 10-23-21:   Biden's Commerce Chief entered the bowels of greed and leverage at Milken and said the following:

The opposition among some lawmakers – all Republicans as well as some moderate Democrats – to raising taxes on wealthy individuals is "almost religious fervor," said Secretary of Commerce Gina Raimondo at the 2021 Milken Institute Global Conference this week.

Milken, Rubenstein, Schwarzman et al created the PEU religion.  They created the greed and leverage fueled fever.  Raimondo should know given her PEU background.

 Update 5-11-22:  Fortune reported:

In the event the crypto exchange goes bankrupt, Coinbase says, its users might lose all the cryptocurrency stored in their accounts too.

Update 5-27-22  Paxos received a federal trust charter from the Office of the Comptroller of the Currency.  Paxos National Trust entity is a federally regulated entity offering custody services, stablecoin management, payment, exchange and other services.  It is different from New York Department of Financial Services-chartered Paxos Trust Co.

Update 7-10-22:  On Meet the Press Raimondo called the public "cranky" for giving feedback on the impact of inflation to elected leaders.  It brought to mind Jared Kushner calling White House attorney resignation threats "whining."  Both Raimondo and Kusher are PEUs, one Red, one Blue. 

Update 1-4-23:  Raimondo has been mentioned as a future Treasury Secretary should Janet Yellen move on.

Update 7-7-23:   Former cryptocurrency hater BlackRock CEO Larry Fink called Bitcoin "digital gold."  His firm has applied for approval for a Bitcoin ETF.  

Update 8-3-24:  BlackRock's Larry Fink flipped on cryptocurrencies, now calling them legit.  He did so after the Trump assassination attempt.  In a strange multiverse development, the shooter appeared in a BlackRock ad.

Thursday, May 20, 2021

Florida Homeowners Squeezed by PEU Level Greed


Wall Street on Parade
stated:

Across Florida, struggling families and senior citizens are opening their homeowners’ insurance renewal notices to learn that their policy will now cost them $800 to $1200 more than it did last year.

Rates are going up by 30 to 40 percent in many cases – during a National Emergency. Making the outrage among residents more palpable is the fact that a hurricane didn’t even touch down in Florida in 2020.

That sounds like the legendary returns of private equity underwriters, also known as the greed and leverage boys.  Forbes wrote in 2012:

"People generally don't love investors and people who have made great wealth in every society," says Carlyle Group co-founder David Rubenstein. "In the past no investor ever asked me how many jobs I created; they never cared. But they did say, 'Give me my rate of return.' " Rubenstein adds: "We have made a lot of money for our investors, and most of them, not all, are big public pension funds who seem to like the returns."

Carlyle's private equity funds have averaged 18% annual net internal rates of returns since inception

Carlyle's co-CEO Glenn Youngkin spoke at the Morgan Stanley Virtual Conference in June 2020.  He highlighted Carlyle's 97% stake in re-insuror Fortitude Re.

Fortitude Re has $43 billion of total assets and as you will all remember, as part of this transaction, roughly $6 billion of those assets are being rotated into private capital strategies managed by Carlyle. So we're excited about this final step. It solidifies Fortitude as a source of long-term capital for us but on top of that, now, we're well positioned to grow through acquisitions by looking at adding on additional runoff blocks of insurance portfolios. 
We do make money here in three ways. We of course have our investment income off of the balance sheet investment that we made in Fortitude. And then as the assets rotate into Carlyle Funds or investment activities, we of course earn management fees from those assets and have the potential to earn performance revenues off of them as well. 


Youngkin is currently the Red team nominee for Virginia governor.  The Forbes piece noted Carlyle's mining of former government officials

Carlyle also amassed a slew of former government heavyweights--and an accompanying cloak-and-dagger reputation.

"The early success in defense helped us understand that we had a core skill of dealing with businesses that are heavily impacted by government policy and regulation such as transportation, health care, telecommunications, etc.," says Carlyle Group co-founder Daniel D'Aniello.

What could Glenn Youngkin do for Carlyle as Virginia's governor?  How will Virginia residents pay for Carlyle to earn profits in multiple ways?  

Sunday, May 16, 2021

Biden Cyber Nominee to Protect Morgan Stanley's Bitcoin Futures

 

President Biden nominated Jen Easterly for a key cybersecurity position in his White House.  Easterly works for Morgan Stanley defending the firm from cyber threats.  Morgan Stanley announced it would cram Bitcoin Futures contracts into a smattering of its mutual funds.  Bitcoin is the favored currency of ransonware pirates.  I imagine the head of cybersecurity had input as to the safety of Bitcoin and the risk's involved in investing in the cyber-currency. 

The SEC had this to say about Morgan Stanley's move:

Bitcoin is a “highly speculative” asset, according to the staff statement, published Tuesday by the Division of Investment Management. The note warned investors in mutual funds that trade bitcoin futures may be taking on more risk than they realize.

Goldman Sachs announced it would offer Bitcoin derivatives.  How long before Goldman is charged with manipulating that market?  Morgan Stanley also has a record of self dealing to the detriment of customers.

As a public official Easterly would be in a position to influence the direction of those Bitcoin futures.  Easterly knows how to defend Wall Street with its new Bitcoin bet products. 

Thursday, May 13, 2021

Biden's CyberSecurity Nominee Inglis is a PEU

 

Chris Inglis is President Biden's nominee for National Cyber Director.  He's also is a private equity underwriter for Paladin Capital.

Inglis joined Paladin Capital in 2014 and had six years to invest alongside Paladin's limited partners.  Those investments are private and difficult to shed.  

Inglis serves on two private boards, Blackpoint and Securonix, as well as two public companies, FedEx and Huntington Bankshares.

Biden's cabinet is chock full of PEUs.  The greed and leverage boys identified political connections as a way to make big money.

President Obama's health reformer, Nancy-Ann DeParle, came from the PEU world and returned to it afterwards.  Her financial disclosure omitted any residual PEU investments, yet a payout from MedQuest, appeared years into her public service.  

If approved as National Cyber Director how will Inglis divest himself of difficult to flip private equity holdings. Will he be paid for residual stakes years into his public service like Obama's health reformer?

Politicians Red and Blue love PEU.  And PEUs love what politicians can do for them. Uncle Sam's wallet is good for spending.  However, the greed and leverage boys are loathe to fill it with a slice of their massive profits.