WASHINGTON (Reuters) – U.S. Treasury Secretary Timothy Geithner said on Friday that the Obama administration will provide “substantial support” to troubled lender GMAC, a vital provider of financing for the domestic auto industry. “We’re going to provide substantial support to GMAC,” Geithner said in an interview with Reuters Television. “It’s likely, again, that GMAC will […]
SHANGHAI (Reuters) – Chinese investor group Best Prospect Overseas Ltd said on Friday it was withdrawing its offer to acquire 51 percent of Hurray Holding Co Ltd (HRAY.O), a day after it raised a bid for the U.S.-listed ringtone provider. “We gave Hurray’s board enough time and our patience has been worn away,” Jacky Tung, […]
Advent International has acquired a 30% stake in CETIP SA-Balcão Organizado de Ativos e Derivativos, a central depository for private fixed-income securities and over-the-counter (OTC) derivatives in Latin America. The deal is valued at approximately R$360 million (US$170.6 million), subject to an earn-out achievement and other conditions.
In a deal that defies the stilted secondary market, Merrill Lynch yesterday sold €150 million worth of shares in Kreos Capital, a European venture debt fund manager. The buy-side group included Paul Capital, AIG PineStar Capital, HarbourVest Partners, Access Capital Partners and SVB Financial Group. Alongside the spinout of Lehman Brothers’ venture arm (advised by Harbourvest Partners), it is one of the largest secondary transactions to close this year. I spoke with the deal’s sell-side advisor, David Waxman of Azla Advisors, on where the deal stands in the greater secondary market. How does this deal fit in with the general market activity? The gap between buyers and sellers is wide because it’s so tough to value equity at this stage. … There’s a feeling in the secondary community that NAVs don’t yet reflect the full value of the writedowns, and so it’s difficult for them to offer much for the LP interests. There’s even a debate over whether secondary investors should stay away from ’06-’07 vintage private equity funds altogether. In this deal, we started working with Merrill Lynch two years ago. Merrill planned to be the sole sponsor of Kreos for two years and then divest 75% of holding on secondary market.
We won't soon see another deal like KKR's $1.8 billion carve-out of Oriental Brewery. The year's second-largest buyout was made possible by the combination of a motivated seller and an unusual capital structure. According to a source familiar with the situation, KKR's bid was actually the lowest of the three final offers -- from Affinity Equity Partners and MBK Partners -- but KKR won because its was the only offer with committed financing. This was important to Anheuser-InBev because the company is in a bit of a pinch to pay down debt: it has a $7 billion bridge loan due this fall. Anheuser-Inbev was so motivated, in fact, that it set up a $300 million PIK note for the deal, something that wasn't necessarily offered to KKR's competitors.
As usual, we have a week’s worth of ratings agency downgrades, upgrades, revisions and withdrawals on the debt of LBO-backed companies, via Standard & Poor’s and Moody’s Investor Services. It was a light week coming off the big Chrysler filing last week. No worries, two frequent downgraders, Ply Gem and First Data, didn’t disappoint. Company: First Data Corp.
Sponsor: KKR
Downgrade: Moody’s downgraded the company’s corporate family and probability of default ratings to B1 from b2.
Highlights: “We expect slight revenue and EBITDA declines for 2009 with only modest recovery for 2010. As a result, we believe the company will not be able to significantly de-leverage until 2011 at the earliest, at which time the company faces increasing cash interest payments as the company's 10.55% unsecured PIK notes convert to cash pay after September 2011.”
Greenwoods Capital and Scorpion Capital have acquired the assets of Champion Broadband California, operator of broadband services in the Arcadia and Monrovia communities. RBC Daniels advised CBC on the deal.
Gordon Brothers and Hilco Consumer Capital have completed their acquisitions of Polaroid, out of bankruptcy.
Why is a standard software services business suddenly the most coveted company around? SumTotal Systems last month agreed to sell itself to Accel-KKR, but yesterday received a competing bid from Vista Equity Partners, a firm that's already had past offers dismissed. The whole process seems like a relic of frothy M&A time gone by, and in a way, it is: The battle to win SumTotal started in April of last year. After digging through this behemoth proxy statement, I learned that Vista and Accel-KKR have jumped through no shortage of hoops to bed SumTotal. After more than six months of meetings, Accel-KKR offered to buy the company for $7 per share, then $8 per share, then finally back to $7 per share in the fall of 2008 (just after Lehman Brothers collapsed). Even though SumTotal's M&A Committee recommended the deal, the company's board said no thanks. Simultaneously, Vista Equity had its offer rejected by SumTotal's CEO without any board consideration (pricing wasn't provided in the filing). Once the stock market began to tank
NEW YORK (Reuters) – Western Union Co (WU.N) said on Thursday it would buy Canada-based Custom House Ltd, a provider of payment solutions for small and medium enterprises, for $370 million in cash, expanding its global payments capabilities. Custom House is owned by Chairman Peter Gustavson and Boston-based private equity firm Great Hill Partners. It […]