Erin Griffith

Yesterday we posted a list of the year's five "false alarms," or trends that were blown out of proportion in the last year. Things that everyone got excited about happening (for better or for worse) but never really happened. You know, things like LP defaults, the secondary market, and PE bank deals. That's not to say we weren't surprised by a few things, for better or for worse. Here's a slightly shorter list of what caught private equity off guard this year.

As usual, we have a week’s worth of ratings actions (mostly downgrades) on the debt of LBO-backed companies from ratings agencies S&P and Moody’s. This week Warburg Pincus completed a distressed debt exchange, which Moody’s answered with a downgrade. Meanwhile, S&P is encouraged by the not-declining performance of Claire’s Stores, the teen jewelry mall retailer owned by Apollo Management. I guess it’s really true that “flat is the new up.” Company: Claire’s Stores Sponsor: Apollo Management Action: Standard & Poor's Ratings Services revised the outlook on Pembroke Pines, Fla.-based Claire's Stores Inc. to stable from negative. At the same time, we affirmed all other ratings on the company, including the 'B-' corporate credit rating. Highlight: While we believe operations will likely remain challenged given difficult macroeconomic conditions and the company's dependence on mall traffic, we do not expect them to substantially decline over the near term. Claire's credit protection metrics have stabilized along with operations and have evidenced little material change over the past year.

Be Happy You're Not Blackstone Rich: That may lead you to getting blackmailed, as David Blitzer an MD with the firm learned. (WSJ) Well That's Over. Kinda. CIT is out of bankruptcy and trading on the public markets again, and excited traders are trading it up. (Money Game) Second Acts: Could Eliot Spitzer Run for Comptroller? I mean, seriously? By the way, click through to this story just to see that the Post has not disappointed in its choice of accompanying photo of the disgraced governor. (NY Post) Myths: Has the link between testosterone and aggressive trading been blown out of proportion? Hint: Yes. (Naked Capitalism)

After the September 2008, no one knew what to expect in the upcoming week, let alone the next month or year. That uncertainty led to a lot of freaking out over nothing this year, and private equity had its fair share of false alarms. Here are five “trends” that had buyout barons shaking in their boots, but ended up being no big deal at all. (Literally! Get it? There were no big deals? Anywaaaaays...)

In the last week, two firms have released surveys gauging LP interest in private equity. I imagine they each looked something like this: To: LPs Do you like me? Circle one: YES NO From: GPs In one study, the LPs circled "no," and in another, they circled "yes." So which is it? Will investors back buyout firms next year or not?

This month’s Prequin Private Equity Spotlight focuses on private equity funds of funds and their growth in popularity as both investment vehicles and investors. According to the report, which you can download below: Fund of funds managers have become increasingly significant (as investors in buyout funds), growing from making up 16% of the average fund […]

Here are some potential M&A ideas, rumored or official, to jumpstart your deal pipeline. Our sources are various news reports and the Buyouts “Seeking Buyers” list. For prior lists, see below. IPL Inc., a Canadian manufacturer of plastic products, has constituted a strategic review committee of independent directors to investigate and evaluate the various strategic alternatives IPL. IPL has retained Ernst & Young Orenda Corporate Finance Inc. as advisors to assist in this process. TCW Group is selling $450 million of mortgage-backed securities. The bids were taken on December 8. The securities include Alt-A and prime-jumbo mortgage bonds held by the Los Angeles-based company's TCW Total Return Bond Fund and TCW Galileo Total Return Bond Fund. Dow Chemical and BASF are seeking buyers for styrene-making segments of their businesses.

Plan B: This is funny. "My desire to attend law school has nothing to do with the fact that I was recently fired from my job as an analyst at an investment bank." (McSweeney's) Private Equiteer: Private Equity returns are misleading Part II. (Seeking Alpha) More Extortion: Or whatever you'd like to call it. Riverstone's founder David Leuschen has paid $20 million to Andrew Cuomo in restitution over the pay-to-play case. Chooch really is the gift that keeps giving (and yes, I plan to continue to bring it up every chance I get.) (OAG) Debunks: Goldman Sachs bankers aren't really stocking up on guns. (Deal Journal) Vanity: Remember the guy with the license plate that read "2BG2FAIL"? Well he's changed it to "MNA GUY." (Clusterstock) You Shouldn't Have: The economic argument for never giving another gift. (Slate)

Audax Group confirmed today with an SEC filing that it is in the market raising a $750 million mezzanine fund, a follow-up to the firm’s $700 million second fund. The fund was first reported by peHUB in July. At the time, Audax Co-CEO Geoff Rehnert told peHUB that the firm expected to close on Audax Mezzanine Fund III LP in Q4, however the SEC filing does not indicate any capital raised. I’ve got a call in to Audax about why that is. UPDATE: Audax called back with no comment, given SEC restrictions against marketing. The firm’s prior mezz fund may be nearing full deployment, considering it was 70% spent in July.

Sure, David Leuschen had cattle castration, and the Logliscis had "Chooch," but when it comes to sources of schadenfreude, Tim Durham truly tops them all. In case you missed the Thanksgiving-time news of the FBI raiding Durham's Indiana buyout shop, Obsidian Enterprises, here's a quick rundown: Durham's other firm, an Ohio firm called Fair Finance Services, is accused of running a Ponzi scheme and acting as Durham's "personal bank" for seven years. The firm sold certificates intended for investments in small businesses, and while it used some of the money to invest in Obsidian companies, it passed the rest back to earlier investors, Ponzi-style, according to a civil complaint. Even worse, it created a vehicle to make personal loans to Durham and his partner. So Durham's offices were raided, and he's cooperating, claiming he did nothing wrong. But once you read about Durham's amazingly classy antics you can't be that surprised the guy tried to skirt the rules.