private equity

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Carlyle Near Collapse After Defaulting on $16B

Big banks put screws to overextended fund

(Newser) - Carlyle Capital announced overnight that it is defaulting on $16.6 billion in debt, and its creditors are likely to take possession of its remaining assets. The latest casualty of the credit catastrophe is a major embarrassment for Carlyle Group, the private equity firm whose executives own 15% of the...

As Margin Calls Mount, Carlyle Holds 'Crisis Talks'

Private equity giant's subsidiary imperiled

(Newser) - The Carlyle Group is holding emergency talks with lenders to try to save its drowning Carlyle Capital division, the Washington Post reports. Creditors have decided that Carlyle’s portfolio of traditionally safe mortgage-backed securities holdings isn’t good enough in the current market, and they're demanding $400 million more in...

Soured Deals Dog Brash Cerberus
Soured Deals Dog Brash Cerberus
Feb 25, 2008 1:15 PM CST

Soured Deals Dog Brash Cerberus

Chrysler, GMAC struggles point to problems for private equity giant

(Newser) - The continued struggles of Chrysler and GMAC—two of Cerberus Capital Management’s largest and most recognized purchases—have observers wondering if the private equity darling has lost its Midas touch, reports Reuters. S&P has downgraded GMAC’s credit rating, Chrysler's January sales slipped 12% even as the company...

Markets Drop as KKR Unit Delays Payment

Concern about liquidity in the US has investors selling off in Asia

(Newser) - Asian stocks slumped today after reports in the Financial Times that a struggling arm of private equity heavyweight Kohlberg Kravis Roberts. missed a second payment on billions of dollars of commercial debt just 6 months after two of its founders poured $270 million into the company. Investors cashed out as...

Sallie Mae Drops $900M Lawsuit
Sallie Mae Drops $900M Lawsuit
Jan 29, 2008 9:31 AM CST

Sallie Mae Drops $900M Lawsuit

Move helps struggling student loan provider obtain $31B in financing

(Newser) - Beleaguered student loan provider Sallie Mae yesterday dropped its $900 million lawsuit against the onetime suitors who bailed on a $25.3 billion buyout after the credit crunch caused would-be investors to walk away, reports the Washington Post. By agreeing not to seek the penalty from investment firm JC Flowers...

Jamba Founders Buy Stake In Facebook
Jamba Founders Buy Stake In Facebook
Jan 16, 2008 12:29 AM CST

Jamba Founders Buy Stake In Facebook

Samwer brothers join Microsoft in social networking venture

(Newser) - Brothers Alexander, Marc and Oliver Samwer, founders of ring tone company Jamba, have just joined Microsoft and Hong Kong billionaire Li Ka Shing as major investors in US based social networking company Facebook. Though the Samwers' haven't disclosed the exact size of their investment, they told Der Spiegel  it was...

PHH Deal Collapses After Banks Back Off

Blackstone Group says lenders reneged on original financing terms

(Newser) - The $1.8 billion sale of mortgage and auto-leasing company PHH to General Electric and  the Blackstone Group is off the table, after Blackstone was snubbed by banks it had lined up for its share of financing, Bloomberg reports. The deal is the latest private-equity buyout felled by the subprime...

Student Lender Sallie Mae Plans $2.5B Stock Sale

Embattled stock drops 6.5% as investors fret

(Newser) - With a credit rating bordering on junk-bond status, embattled student loan provider Sallie Mae plans a public stock offering to raise $2.5 billion, reports the Wall Street Journal. The company will use $2 billion to buy back its own stock futures, which have lost value recently following a failed...

House Passes Alternative Minimum Tax Bill

But bill is unlikely to make it through the Senate unchanged

(Newser) - The House passed a sweeping tax-reform bill yesterday—shifting some $78 billion in taxes from middle-class families to the super-rich—that is expected to get little traction in the Senate and has already drawn the promise of a presidential veto. The bill would exempt middle-income families from the Alternative Minimum...

Rangel Pushes Corporate Tax-Rate Cut

Tax-rate trim from 35% to 31% would be offset by eliminating tax breaks

(Newser) - Rep. Charles Rangel, the Democratic chairman of the House Ways and Means Committee, has proposed a revised corporate tax structure that could lower corporate income taxes from 35% to between 30% and 31%. It would be offset by doing away with tax breaks for manufacturing in the US. The bill...

Chrysler to Cut Non-Union Jobs
Chrysler to Cut Non-Union Jobs
Oct 9, 2007 2:27 PM CDT

Chrysler to Cut Non-Union Jobs

Automaker slashes non-unionized jobs to avoid GM's fate

(Newser) - With Chrysler deep in talks on a new contact with the UAW—the clock is ticking on a strike deadline tomorrow morning—sources tell the Detroit Free Press that cuts to non-union employees are in the works. Loss of about 1,600 salaried and contract jobs is expected, on top...

Sallie Mae Sues Spooked Suitors
Sallie Mae Sues Spooked Suitors
Oct 9, 2007 5:45 AM CDT

Sallie Mae Sues Spooked Suitors

Student-loan giant refuses to renegotiate $25B buyout deal

(Newser) - College student lender Sallie Mae is suing a group of private equity firms and banks that are backing out of a $25-billion buyout deal. The group—J.C. Flowers & Company, Friedman Fleischer & Lowe, JP Morgan Chase and Bank of America—had set a deadline of today for negotiating...

$25B Sallie Mae Buyout on the Rocks
$25B Sallie Mae Buyout
on the Rocks
Sep 27, 2007 9:52 AM CDT

$25B Sallie Mae Buyout on the Rocks

Credit market implosion leaves buyer looking for the door

(Newser) - Sallie Mae doesn’t look like such a bargain at $25 billion anymore, and J.C. Flowers & Co. is trying to renegotiate—or escape—its deal to acquire the student lender, citing the credit market implosion and legislation to reform student loan practices. It’s the kind of deal...

Nursing Homes Raise Profits, Cut Care

Private equity firms buying up, stripping down facilities

(Newser) - Caring for grandma has become big business for private firms that are buying nursing homes and making them profit generators. But to do it, they’ve severely cut staff—sometimes below legal levels, the New York Times found. “Chains have made a lot of money by cutting nurses,”...

Feds to Charge Hsu on Pyramid Scheme, Dem Fundraising

Some of missing money said to be donated

(Newser) - Rogue Democratic fundraiser Norman Hsu’s troubles are deepening today, as federal officials are expected to charge the twice-on-the-lam financier with running a $60 million pyramid scheme and breaking campaign-finance laws. Hsu faces accusations that he falsely told investors their money was going into a clothing operation; some of was...

KKR Prepares for Test of Credit Markets

Fate of pending deals may foretell future of private equity

(Newser) - Kolhberg Kravis Roberts is pushing forward with some of the biggest deals in US history, but the iconic buyout firm finds itself under unprecedented scrutiny. Analysts say the huge deals KKR has pending will be a test of the struggling credit markets, the Washington Post reports: If they don't go...

House Targets Hedge-Fund Tax Deferments

New bill would cut tax deferrals on overseas income for managers

(Newser) - Democratic Rep. Rahm Emanuel said yesterday he will draft a bill to close a loophole that allows private-equity and hedge-fund managers to defer taxes on income earned by funds abroad. Emanuel proposes to limit such tax deferrals to $19,500—the amount anyone can put into a retirement account tax-free....

Home Depot Deal Renovated
Home Depot Deal Renovated
Aug 27, 2007 5:37 AM CDT

Home Depot Deal Renovated

Price for wholesale unit slashed

(Newser) - The sale of Home Depot's wholesale supply unit—threatened by the credit crisis —is going ahead after tense negotiations between Home Depot, private equity firms buying the company and banks providing the financing. Home Depot slashed its price 18% to $8.5 billion and guaranteed some of the loans...

Banks Might Derail Home Depot Deal
Banks Might Derail Home Depot Deal
Aug 24, 2007 7:10 AM CDT

Banks Might Derail Home Depot Deal

Private equity threatens lawsuit as financing dries up

(Newser) - The pending sale of part of Home Depot took an ugly turn last night as three banks and three private equity firms entered into a showdown over financing. Home Depot dropped its asking price by over $1 billion, but the banks involved—JPMorgan Chase, Lehman Brothers and Merrill Lynch—have...

Credit Jitters May Put KKR Offering on Ice

Private equity firm denies reports its IPO will be delayed

(Newser) - The Times of London claims that buyout firm KKR has postponed plans for a $1.25B float and a public listing because of the fallout from turbulent credit markets. The company had planned its IPO this September but has reportedly pulled back due to waning investor confidence following the subprime...

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