Where Are They Now? The Performance of Failed Take-Privates

Remember when PE firms backed out of signed deals in droves? They looked like jerks at the time, but in retrospect, they were probably smart to avoid the overpriced, highly leveraged deals they had aggressively pursued for the past three years.

Taking into account the Dow’s record breaking drops last year, and assuming that a company’s stock price reflects its health, let’s look at the stock performance of 2008’s busted take-private targets and recoil at the premiums PE firms might have paid.

Reddy Ice
Sponsor: GSO Capital partners
Date of Collapsed Deal: Jan 31
Proposed Takeover Price: $1.1 billion
Today’s Price/Market Cap: $30.74 million

3Com
Sponsor: Bain Capital
Date of Collapsed Deal: March 20
Proposed Takeover Price: $2.2 billion
Today’s Market Cap: $905.02 million

Myers Industries
Sponsor: GS Capital Partners
Date of Collapsed Deal: April 3
Proposed Takeover Price: $1.1 billion
Today’s Price/Market Cap: $123 million

Alliance Data Systems
Sponsor: GS Capital Partners
Date of Collapsed Deal: April 4
Proposed Takeover Price: $6.4 billion
Today’s Price/Market Cap: $1.8 billion

Cumulus Media
Sponsor: Merrill Lynch Private Equity and Management
Date of Collapsed Deal: May 12
Proposed Takeover Price: $1.3 billion
Today’s Price/Market Cap: $38.2 million

Penn National Gaming
Sponsor: Fortress Investment Group and Centerbridge Partners
Date of Collapsed Deal: July 3
Proposed Takeover Price: $6.1 billion
Today’s Price/Market Cap: $1.63 billion

BCE
Sponsor: Ontario Teacher’ Pension Plan, Providence Equity Partners, Madison Dearborn Partners and Merrill Lynch Global Private Equity
Date of Collapsed Deal: December 11
Proposed Takeover Price: C$52 billion ($41 billion)
Today’s Price/Market Cap: $15.62 billion

Huntsman
Sponsor: Apollo Management and Hexion Speciality Chemicals
Date of Collapsed Deal: December 14
Proposed Takeover Price: $10.6 billion
Today’s Price/Market Cap: $654.06 million

2 Comments

  • Looks like Apollo would have made a(nother great) mistake with Huntsman…

  • Umm..should you be comparing the takeover price to EV vs. just the market cap?

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