Not only private equity deals are in trouble today, but many, many other businesses too. The only wonder is that any businesses are surviving the Obama depression.
Durden’s piece is completely irrelevant to the performance of Bain during Romney’s reign. It is also irrelevant to the performance of PE funds before 2008. The fact is that Bain was very successful from 1984 to 1999. Romney did a good job. Unfortunately, his brains must have fallen out when he entered politics.
The Bain attack is dishonest and stupidly short-sighted. Romney needs to be stopped, but adopting criticisms worthy of Michael Moore is destructive.
http://www.buyoutofamerica.com/
Here are some quotes I scanned from a couple linked articles there...
“Bain Capital had a business model that was intended to essentially transfer wealth from its holdings to itself,” said current Ampad chief executive Don Meltzer, who was not involved with the business in 1995. “... [They did this] instead of building the wealth of the company that they owned and extracting gains through selling the company.”
Contrary to the selling of Romney as a “turnaround artist,” many of Bain’s actions were not intended to right their properties over the long term. For instance, after acquiring medical equipment maker Dade Behring, Bain slashed its research and development budget...
The same month that Dade converted the pension, it used the projections of that very savings as part of the basis to borrow $421 million, which it then turned around and used to buy shares from its owners... Bain and Goldman had only put $85 million down to buy the company, yet in June 1999 they received $365 million from the dividend, 4.3 times their money.
Dade borrowed so much to make this payment that its debt more than doubled to $871 million (68 percent of sales.) Standard & Poor’s lowered Dade’s credit rating from the BB to B category...
The strategy of sharply increasing Dade’s debt alarmed several executives. Mr. Garrett, the former chief executive of Dade who stood to gain from the transaction, said he had argued unsuccessfully against it.
Creditors, unsettled by deteriorating finances and high debts, began to pounce. More layoffs followed. And in August of 2002, Dade filed for bankruptcy protection.
Has there been some internet attack? FR hijacked? I am beginning to feel like I am on democratic underground. Been a daily FR reader and paying subscriber for 12 years. I can’t believe that many on here are bashing capitalism, and accepting adultery.
I understand many on here don’t like Mitt. But don’t throw away your conservative principals over any candidate.
This is not about whether MItt/Newt/Santorum should be the nominee. I just can’t believe the “conservative calisthenics” that so many are going through due to their hatred of Mitt.