So are you part of the Occupy crowd? If you believe in the Free Market your going down the wrong road. This company did a service for other companies. Some companies made it some didn’t!
From Forbes today:
I can give you several gritty reasons why former Bain private equity czar Mitt Romney is not the person to become President of the U.S. in November.
First, is just one tale of a Bain deal under Romney. Bain invested just $30 million to take over a company. It then arranged for this company to pay Bain and its investors a special dividend of $180 million– or six times the amount of equity capital Bain invested to take control. This technique of forcing your prey to pay back your original investment or more, as in this case, is to ensure that the Private Equity Firm is assured of a profit. It is an exploitative way to strip the company of its spare cash and is indefensible corporate rape.
Know that Warren Buffett, CEO of Berkshire Hathaway has sworn in every annual shareholder letter that he will never, ever buy a division or a company from the private equity jugglers who buy and then sell on the company they have leveraged up with professional managers in it just for the soils of the deal– and certainly not the family or long term management devoted to the company’s historic role. Think the farce of RJR Nabisco or EMI or Texas Utilities.
I can assure you no private equity CEO has ever made money for his public shareholders. I have the tawdry lesson of Blackstone in mind. Issued to the public at $31 a share, it bumped up to $35 a share when Private Equity was all the rage and young dudes were all hot and bothered in 2007 to get in and get rich quick. Remember that; quick. But, from the fantasy times of 2007 BK shares were roiled all the way down to $5.00 a share in 2009– a sweet paper loss of 85%, and are still 50% below their original offering price at $15, well below supposed book value. KKR and Carlyle are drolling at the expectation liquidate insider and founder positions– and the public be damned.