Bain Capital, co-founded by U.S. Republican presidential candidate Mitt Romney, is defending its business model, countering charges it raids companies and slashes jobs as Americans struggle economically, Reuters reported Wednesday. The firm sent a letter to investors Tuesday, saying that it had created hundreds of thousands of jobs in its 28-year history and supported hundreds of charities. Bain said less than 5% of the companies it invested in filed for bankruptcy and pointed to the “growth trajectory” of its portfolio, with over 7% revenue gains and $4.1 billion in realized profits from its funds in 2011, Reuters wrote.
(Reuters) – Private equity firm Bain Capital LLC, co-founded by U.S. Republican presidential candidate Mitt Romney, on Tuesday defended its business model, countering charges it raids companies and slashes jobs as Americans struggle economically.
Romney’s presidential bid has led to political attacks on Bain, the firm he ran from 1984 to 1999, at a time of high U.S. unemployment and growing income inequality.
In a letter to investors on Tuesday, the Boston-based firm said it had created hundreds of thousands of jobs in its 28-year history and supported hundreds of charities.
Bain said less than 5 percent of the companies it invested in filed for bankruptcy and pointed to the “growth trajectory” of its portfolio, with over 7 percent revenue gains and $4.1 billion in realized profits from its funds in 2011.
Bain said its companies have seen revenues rise by more than $105 billion globally since its investment, including $80 billion of growth in the United States, and that its firms currently employ over one million people worldwide.
“While not every business can be successful, any fair-minded assessment must also take into account the jobs preserved in the businesses that we have turned around, transformed and then grown,” Bain said.
Romney, leading the Republican presidential race, has cited his years at Bain as proof he is a good economic manager at a time when the U.S. economy is struggling to recover.
But Romney’s opponents have portrayed Bain as a corporate raider which profits at the expense of average Americans.
Bain investors contacted by Reuters, including some of the largest U.S. public pension funds, have said political attacks have made no difference in their assessment of Bain and that their focus is on returns and the fees they are being charged.
In the letter to investors, Bain said it had “a great deal of respect” for those who pursue public service, citing Romney, but added the private equity firm was separate from politics.
Bain’s managing directors thanked investors for their support amid “sensationalist rhetoric and political noise”.
“Many of our managing directors and employees make individual decisions to support causes and political candidates espousing a range of views, but we assure you that Bain Capital itself is separate from politics,” they wrote.
“Mark Twain’s famous witticism, ‘Get your facts first, and then you can distort them as much as you please,’ has unfortunately become a hallmark of today’s political process,” they added.
Romney has opened a big lead in delegates in the Republican race to pick a challenger to U.S. President Barack Obama in the Nov. 6 election, but he is struggling to capture the hearts of conservatives who distrust him for some of the moderate stances he took as governor of liberal Massachusetts.
(Reporting by Greg Roumeliotis in New York; Editing by Michael Perry)