Private Equity

E-betting boss opens all his presents in one go

23 Dec 2019

DraftKings CEO Jason Robins is raising cash, buying a company and going public by merging with a SPAC. It could be a smart bet on U.S. online gambling growth. But investors’ willingness to hand him supervoting rights shows they’ve learned little from the WeWork and Uber debacles.

Buyout barons’ debt machine will blow a gasket

19 Dec 2019

The $1 trln market for bonds backed by leveraged loans has fuelled the boom in private-equity dealmaking. A weaker economy will make investors wary of buying these so-called CLOs, and force vehicles to curb lending. That means higher borrowing costs, and probably fewer takeovers.

Japan’s buyout teams face endurance challenge

19 Dec 2019

Industrial group Showa Denko is buying Hitachi’s chemical arm for $9 bln, disappointing private equity suitors like Bain and Carlyle. Firms are raising record sums in the hope that corporate reforms unleash a wave of dealmaking. Flush with cash, Japan Inc is crashing the party.

German listings breakup puts LBO shop in fast lane

18 Dec 2019

Hellman & Friedman paid 3 bln euros for the car sales division of classifieds group Scout24. It’s a rich price, but the unit’s racy growth means the buyout fund should make a healthy return. A higher exposure to risky property leaves the seller’s investors with a bumpier ride.

Haagen-Dazs cash may melt in Nestlé’s pocket

11 Dec 2019

The Swiss giant is selling its U.S. ice cream unit to a joint venture with buyout firm PAI for $4 bln. A big dollop of debt gives the $312 bln group a taste of private equity returns. After his second big disposal this year, CEO Mark Schneider might be tempted to splash out.

SoftBank WeWork debacle is dot-com bubble déjà vu

4 Dec 2019

Boss Masayoshi Son’s first Silicon Valley foray in the 1990s saw busts around now-notorious online grocer Webvan and others. After the WeWork rescue and Uber’s post-IPO slide, a third shot in the form of a second $100 bln-plus Vision Fund will encounter more investor skepticism.

Man City adds scrappy player to financial roster

27 Nov 2019

Silver Lake is buying about 10% of the Premier League club's owner, valuing the global soccer conglomerate at an eye-popping $4.8 bln. Victory on the pitch won’t be enough to satisfy the buyout shop’s investment goals. That may take winning in streaming, e-sports and even China.

Colony Capital is easy target even minus politics

26 Nov 2019

Activist investor Blackwells Capital wants Tom Barrack, the real-estate veteran and backer of Donald Trump, ousted as the asset manager’s CEO. Barrack has probably been distracted. But lousy returns on Colony’s stock and poor governance are enough to justify a shareholder revolt.

UK $4 bln science LBO tests secondary-buyout craze

21 Nov 2019

Cinven, Astorg and Abu Dhabi’s wealth fund are taking a drug-testing group off KKR’s hands. The buyer knows the sector and has a clear M&A-driven plan, but the price is high. With tons of buyout cash and weak IPO markets, such eyebrow-raising “pass the parcel” deals will boom.

Private-equity bosses will come under scrutiny yet

20 Nov 2019

Blackstone, KKR and peers were a no-show at a U.S. political hearing about their activities. Lawmakers landed few blows. But private equity’s sheer sprawl means the heat will intensify. The ultimate targets may not be companies, but the billionaire buyout barons themselves.

Walgreens LBO could bring the band back together

12 Nov 2019

Buyout shop KKR and drug chain boss Stefano Pessina achieved the improbable in buying retailer Boots and merging it with the U.S. drug store. The fortunes they made may tempt them to an $87 bln buyout of Walgreens. Once again, they’ll need luck, partners and forgiving markets.

Blackstone fashions itself as tech’s anti-SoftBank

8 Nov 2019

It’s buying the parent of dating site Bumble at a $3 bln valuation. Like the Japanese backer of WeWork and Uber, Blackstone has ambition and cash to spend. The difference is that unlike many of SoftBank’s bets, dating apps are a proven business model that can turn real profit.

Walgreens Boots LBO is an idea on drugs

6 Nov 2019

Boss Stefano Pessina turned an Italian pharmacy wholesaler into the $55 bln group. But if he’s thinking of taking Walgreens private, that’s in overdose territory. Even if he rolls his 16% stake, he might need $20 bln of new equity – a huge stretch even for today’s buyout firms.

Soggy pizza burns Chinese firm’s overseas strategy

23 Oct 2019

Buyout shop Hony cleaned up by acquiring state-backed companies before paying $1.6 bln for PizzaExpress in 2014, the same year it invested in Silicon Valley and Hollywood. The UK chain is in trouble as are other deals abroad, including WeWork. It can be hard straying from home.

The Exchange: CalPERS’ Ben Meng

22 Oct 2019

Almost a year into the job, the investment chief of California’s near-$400 bln public pension fund tells Tom Buerkle that size can be a double-edged sword. He explains why returns targets are a challenge and what CalPERS is doing to ensure its new private-equity push succeeds.

Warehouse IPO reroutes Asian investment bank fees

21 Oct 2019

Warburg Pincus-backed logistics firm ESR is trying a Hong Kong market debut again after postponing an effort in June. Morgan Stanley has been enlisted to lead the $1.4 bln deal over Deutsche Bank and CLSA. Given the industry shakeup, it may be a sign of things to come.

Blackstone makes like a sea urchin in Japan

16 Oct 2019

The buyout shop wants to take over hotelier Unizo for $1.6 bln using an entity named after the local delicacy. Like the animal, the bid for the reluctant target is spiky. The deal also has a squishy appeal, with a rich premium for shareholders and tasty morsels for employees.

AMS has tricky route out of M&A cul-de-sac

15 Oct 2019

The Austrian sensor maker has no good options after its failed bid for lighting group Osram. But German regulators have given it a least-bad exit via a sneaky loophole. It’s not perfect but is better than selling down its Osram stock at a loss or ditching its strategic ambitions.

UK’s $4 bln cyber buyout is pricey but defensible

14 Oct 2019

Thoma Bravo is paying a hefty 37% premium for Sophos, which has battled volatile software renewals. The offer is a high multiple of EBITDA. Yet the cybersecurity firm’s network of distributors should keep rivals out, and give the private equity barons room to grow through M&A.

India Insight: Oyo gives off a WeWorky vibe

14 Oct 2019

Ritesh Agarwal’s $10 bln upstart is pushing into co-working, cloud kitchens, weddings and more, frantically expanding beyond its base as the world’s No. 2 hotel rooms provider. Oyo’s dizzying rise and dealings with SoftBank echo the hype before the fall of Adam Neumann’s empire.