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peHUB First Read Dan Primack |
| posted on: 05-16-2008 | |
* BCE repricing fears persist, in the wake of what happened earlier this week with Clear Channel.
* VentureBeat has a Q&A with Steve Jurvetson, on a cleantech biz plan competition and playing God.
* CBS buys CNet. Now who should buy CBS? Felix suggests Berkshire Hathaway.
* The Alliance Boots bankers Read more.
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Tony James: Cov-Lite is Good for You Erin Griffith |
| posted on: 05-16-2008 | |
The Blackstone Group’s COO Hamilton “Tony” James wants it to be known that his support of covenant lite and PIK toggle deals is not merely self-serving. He supports relaxed lending terms for the greater good of deal-makers everywhere. “Covenant lite and PIKs are in everyone’s interest,” he said at The Deal’s Private Capital Symposium this week.
The style of financing, popularized during the last few years of highly competitive lending rates, often gets blamed for the current strain in leveraged finance. “Everyone hates covenants, but they work!” is a popular sentiment among lenders, now in the driver’s seat with liquidity dried up.
James argued that LBO shops have a better understanding of how to recap a struggling company than its lenders do. Why involve them in ...
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Blackstone Group May Get Sector-Specific Dan Primack |
| posted on: 05-15-2008 | |
The Blackstone Group (BX) is toying with the idea of raising sector-specific funds, peHUB has learned. This would be a major strategic shift for the firm, which historically has made all of its private equity investments out of the same general fund (sans real estate).
A firm spokesman declined comment, but here is what we know: Blackstone is currently raising its seventh mega-buyout fund – Blackstone Capital Partners VII – with a $20 billion target. That vehicle is expected to hold an $8 billion first close on June 27.
The firm also is telling prospective LPs that it may raise a series of industry-focused funds before the BCP VII investment period concludes. This could include funds dedicated...
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Partech Asks LPs for Help Dan Primack |
| posted on: 05-15-2008 | |
Last week, I asked the following: Can you name the venture capital firm that recently asked its limited partners to help arbitrate a spat amongst the general partners? Hint: Some of its partners need a passport to visit each other face-to-face. Same goes for its LPs.
The correct answer is Partech International, the Franco-American firm that also has an outpost in Israel. Three of you got it right, which puts you on the list for those T-shirts I keep promising to make (think they’ll be ready by peHUB Across America).
All of this has to do with Partech’s fifth fund, which recently closed on $300 mi...
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Glam Rock, Platform Boots & Stagflation Justin Pugsley |
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| posted on: 05-15-2008 | |
Are we about to see a repeat of the bad old days of the seventies – high inflation combined with low economic growth? If so it could have some unpleasant consequences for stock markets and M&A activity.
The signs are not encouraging. The UK’s official inflation figures hit 3% in April, quashing rate cut hopes in the process. But who actually believes these numbers? The old UK retail price index – ie un-EU harmonised numbers - came out at a more realistic 4.2%, up sharply from 3.8% the month before. However, several fund managers have told TMN over the months that they believe inflation is closer to 7-8%. Even Stuart Rose boss of retailer Marks & Spencer seems to think they’re in that ball ...
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peHUB First Read Dan Primack |
| posted on: 05-15-2008 | |
* Tony James: Covenant-lite is good for society.
* Top 10 tech trends, according to VCs at the annual Churchill Club dinner.
* GE is looking to sell its appliance unit. Does that mean that Jack Donaghy can focus more on programming, and less on microwaves?
* Kedrosky says we should have should have seen the private equity bubble coming, based on <...
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Confirmed: Comcast Buys Plaxo Alexander Haislip |
| posted on: 05-14-2008 | |
Comcast will announce the acquisition of Plaxo in a matter of hours, PEHub has learned. Deal terms are not going to be announced, a source familiar with the matter says. Expect a release at around 3:30pm Pacific.
Rumors of the deal floated up three months ago and gossip site Valleywag reported the deal value of $175 million but did not name its source.
Henry Blodget said the deal was a bad idea because Plaxo's employees would bail within a week of the deal. Now we'll get a chance to see if they do, it seems.
The deal is a win for investors such as Glob...
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RedLasso Looks to Rope New Round Dan Primack |
| posted on: 05-14-2008 | |
RedLasso, the King of Prussia, Pa.-based company whose technology allows bloggers to embed clips from local and national television networks, is in the market for $15 million in new VC funding, peHUB has learned.
“We’re looking not just for capital, but smart capital,” explains RedLasso CEO Ken Hayward. “We need to be aligned with an investor who brings an air of trustworthiness within the media industry, to help us show that we’re a friend to the content producer… that we’re a solution provider.”
If you've never seen Red Lasso in action, here's a clip I pulled from CNBC this morning: [lasso=e9bfd360-a0d6-4786-84ff-88e4628cb89f home=true]
Red Lasso is currently ...
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Clear Channel Deal Details Emerge Dan Primack |
| posted on: 05-14-2008 | |
Clear Channel has not yet disclosed the nitty gritty of its revised merger agreement, which should allow it be be taken private by Bain Capital and THL Capital. But I just spoke with someone close to the transaction, and have gleaned the following nuggets:
* The stub equity piece is only semi-voluntary. If CCU shareholders don't elect to take all $1.1 billion, they'll be forced to receive it on a pro rata basis. CCU does not expect that to happen, however, particularly because $500 million of it is already spoken for. This includes a $400 million commitment from Highfields Capital Management.
* The revised deal cuts off around $1.75 billion in debt.
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Clear Channel Winners & Losers Dan Primack |
| posted on: 05-14-2008 | |
The Clear Channel saga headed into its final chapter at 11:11 last night, when the company announced that the financing dispute over its buyout had been resolved. Bain Capital and THL Capital will now pay $36 per share to acquire Clear Channel, as opposed to the standing $39.20 per share. In exchange, they will pay a higher interest rate on the debt. The deal will still take several more months to close, due to the need for a new stub equity election and shareholder vote. While we wait, a spot rundown of the winners and losers:
Winner: Bain Capital and THL Capital
We don’t yet have all the revised agreement details, but the share price slash and interest rate hike seem designed to offset each other. This means that the projected IRR should remain relatively constant. This is g...
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