If you haven’t heard much about KKR(Kohlberg, Kravis, Roberts and Co) it’s probably not your fault. Like many Pac Man style private equity groups gobbling up vast proportions of businesses in every sector, they tend to be “publicity shy” and like to operate in the dark of night, with a cloak of anonymity.
In other words, since they and other P.E.’s own much of the media designed to inform us of these matters, it’s not hard to keep things on the QT.
Private Equity basically means that since they have no stockholders to answer to, (except within the compartmentalization of the various individual companies they leverage) they do not have to justify acquisitions and mergers . . . which simply get announced in the back pages of newspapers. (They can also classify just who is investing in the myriad companies under their control!)
According to an updated 2008 ranking created by industry magazine Private Equity International (The PEI 50), thelargest private equity firms include The Carlyle Group, Kohlberg Kravis Roberts, Goldman Sachs Principal Investment Group, The Blackstone Group, Bain Capital and TPG Capital. These firms are typically direct investors in companies rather than investors in the private equity asset class and, for the most part, the largest private equity investment firms focused primarily on leveraged buyoutsrather than venture capital.
(Thomas Lee Partners should definitely be mentioned here, and it is rather suspicious that they have been “omitted”)
Preqin ltd (formerly known as Private Equity Intelligence), an independent data providers provides a ranking of the 25 largest private equity investment managers. Among the largest firms in that ranking were AlpInvest Partners, AXA Private Equity, AIG Investments, Goldman Sachs Private Equity Group and Pantheon Ventures.
Yeah – you got it: the “equity” they raise (at least in the case of AIG and Goldman Sachs) came out of your pockets through things like T.A.R.P and QE1,QE2, 3, 4, 5….. Thanks to the “Federal” Reserve.
In many circumstances these behemouths work together to pool their combined resources in joint ventures. The Bain Capitol Partners / Thomas Lee buyout of Clearchannel is just one example.
The standard operating procedure for P.E. Co’s appears to be one of using connections and influence to drive down the price of said targeted company for takeover, then use those same connections to grow the business to astronomical proportions. At this time it is either sold for profit, or used for more leverage.
These Private Equity firms also work together so they do not have to bid against each other, and this of course keeps prices down and eliminates competition. The charges of bid rigging are many.
Here is but one story of the above mention collusion:
Action alleges banks, private equity firms kept company prices low
Lawyers for the private equity industry are watching a consolidated antitrust class action alleging that 17 private equity companies and investment banks conspired to keep the price of target companies artificially low during a five-year period. The case recently survived a motion to dismiss, exposing to trial companies such as JPMorgan Chase and Merrill Lynch. The suit names some of the most prominent private equity and public investment players, including Bain Capital Partners and The Blackstone Group.
The suit names some of the most prominent private equity and public investment players, including Bain Capital Partners, The Blackstone Group, Kohlberg Kravis Roberts & Co. and Thomas H. Lee Partners L.P.
Eleven companies or their defense attorneys declined comment: Blackstone; the Carlyle Group and a couple of its funds; Goldman Sachs; JPMorgan; Merrill Lynch; Providence Equity Partners Inc.; Silver Lake Partners; Texas Pacific Group; Thomas H. Lee; and Warburg Pincus. Others did not respond to a request for comment, including Apollo Global Management, Kohlberg Kravis and Permira Advisors.
Most informed Americans know something about the Carlyle Group. Famous during the Bush Presidency (Both George Bush’s, Bin Ladens, Queen Liz among others…. were beneficiaries of 911 and the war on terror! What is rarely mentioned by Democrats these days is just how prominent Carlyle still is today in the Obama Admin!
So, here’s a question for ya: WHO DID COUSIN OBAMA APPOINT TO HEAD GM AFTER IT WAS “NATIONALIZED” er…. BAILED OUT?
Daniel F. Akerson was elected chief executive officer of General Motors Company on August 11, 2010. He became CEO effective September 1. Prior to joining General Motors, he was a managing director of The Carlyle Group and the head of global buyout. He served on the firm’s executive committee and was based in Washington, D.C. He joined the GM board of directors July 24, 2009. (source here)
Now…. All you Bush haters, and Obama Lovers….. PUT THAT IN YOUR PIPE AND SMOKE IT. While you’re at it go get some Dunkin’ Donuts because Carlyle owns that too! (sigh)
Bain Capital Partners might be of interest these days if for no other reason than the fact that Mitt Romney is a principle founder. Maybe THAT is why Romney is considered by the “Media” to be a front runner for the GOP Nomination for President of the USA! Starting off with Office Supply giant “Staples” – Bain has, in the matter of just a decade or so, shot to the top of the list of P.E. Firms!
And this can get really sneaky as we will see below. Bain owns Staples, Staples owns Whole Foods, etc….
So – Getting back to our premise, WHO IS KKR?
Its 1980s deals included RJR Nabisco ($25 billion), Beatrice Foods ($6 billion), Safeway ($5 billion), and Owens-Illinois ($4 billion). Dealing continued in the 1990s with the Bank of New England, K-III Holdings (consumer magazines), and TW Holdings (Denny’s and Hardee’s restaurants).
Other holdings include American Re-Insurance, Duracell, First Interstate, Fred Meyer, Stop & Shop, Union Texas Petroleum, and Walter Industries (Hoover’s Handbook of American Business 1993, p. 360). It has also acquired the publishing and media operation, PRIMEDIA (including magazines like New Woman and Seventeen), diversified manufacturer Borden, online mortgage lender Nexstar, Regal Cinemas which have more than 4,100 screens at about 430 theaters in more than 30 states, and the “in-schools” TV network , Channel One (see related article).
Foreign subsidiaries picked up in the takeovers have included Del Monte Malaysia, Del Monte International in Panama and Bandegua (Guatemala), the Philippine Packing Corp., Associated Biscuits Malaysia, and RJ Reynolds Tobacco in Malaysia
Here is just a small snapshot of companies owned or operated by KKR. We only list the ones you will be most familiar with. (We suggest boycotting these companies if you love Freedom!!!)
BMG Music: (buys, or steals copyrights to popular music catalogs) – They have also ruined many a music career through careless and targeted shelving – I call this the “Illuminati Distribution Cartel” – They all mostly work together to allow certain music to be distributed to the public, while gate-keeping those who might contribute to a more “Aware” society. My Friends Gwen Mars were victims of BMG.
Del Monte Foods Co: Described as: One of the country’s largest producers, distributors and marketers of premium-quality, branded pet and food products for the U.S. retail market. U.S. retail market, generating approximately $3.7 billion in net sales in fiscal 2010. They claim to be Nutritionally conscious, but a quick look into the matter shows that they are one of the largest distributors of GMO Foods for people and pets. Del Monte could be considered a major component of the “Illuminati Food Distribution Cartel”.
Dollar General Corp: A customer-driven distributor of everyday items, including basic consumable merchandise and other home, apparel and seasonal products, with more than 8,000 stores in 35 states. (As of February, 2010)
This Company is cornering the market in the “Dollar Store” arena, which targets the nation’s poor (which grows in proportion with every passing day!).
Eastman Kodak: (bought cheap!) A diversified group with a broad range of activities principally across film, photography, commercial printing and consumer electronics.
Energy Future Holding Corp: Manages a portfolio of competitive and regulated energy subsidiaries consisting of TXU Energy, a competitive electricity retailer, Luminant, a competitive power generation business, including mining, wholesale marketing and trading, and construction, and Oncor, a regulated electric distribution and transmission business. The Chairman is Don Evans. The Insider of insiders…. Appointed U.S. secretary of commerce by President George W. Bush. He is also a Senior Partner at Quintana Energy Partners, L.P. (“conflict of interest” is a term that comes to mind.)
Remember VP Dick Cheney’s secret energy meetings before 911? Don was at a minimum a peripheral player.
On the Board of Directors of EFH is Thomas D. Ferguson who also is a managing director of Goldman, Sachs & Co. (See how this works?) Also on the board is Scott Lebovitz, yet another managing director of Goldman, Sachs & Co – Jeffrey Liaw (BoD) Mr. Liaw once worked for Bain Capital (those guys again) -Also on the board is: Marc S. Lipschultz (Goldman Sachs), Lyndon L. Olson, Jr.: Olson was a senior adviser with Citigroup Inc. (Rockefeller) from 2002 to 2008, after serving as United States ambassador to Sweden from 1998 to 2001. (He is also chairman of the board of the Texas Scottish Rite Hospital in Dallas) – Kenneth Pontarelli is a managing director of Goldman, Sachs & Co. in its principal investment.