Archive for the ‘Blackstone’ Category

Yahoo! Jumps on Buyout Rumors from AOL, KKR, Silver Lake, Blackstone

Tuesday, November 9th, 2010

Two years after Microsoft tried to acquire Yahoo! for $33/share and the company lost half its market value, AOL and Silver Lake have separately lined up financial advisers to explore options for the company.  AOL is also exploring a scenario where Yahoo!’s Asian assets are spun off and the capital is returned to shareholders before the acquisition.  AOL has been extremely proactive in buying companies over the past two months, purchasing 5min Ltd., an Internet content provider and TechCrunch, a popular technology blog.

Bloomberg announced today that KKR is also interested in helping finance the transaction.  Silver Lake Partners and Blackstone are currently in buyout talks.  The sponsors are interested in Yahoo!’s 40% stake in Alibaba, a growing Chinese online business.  Yahoo! currently employs about 13,600 people and had revenues of about $1.6 billion last quarter. Shares in the company rose 9.5% on the rumors today, and the firm’s management team may have hired Goldman Sachs as a takeover defense advisor to ward off bids.

According to the WSJ, analysts say that a Yahoo!-AOL merger could create a strong competitor in the display ads market, which is estimated to be $20 billion this year.  This should be an interesting transaction, if it proceeds further, as Yahoo has a market capitalization of $21.85 billion and AOL has a market capitalization of $2.66 billion.  However, analysts value Alibaba.com at between $15bn and $25bn, which means that Yahoo!’s 40% stake could be worth $10 billion. By selling those assets, Yahoo!’s market value would fall to about $11 billion, which would make the deal much more realistic.

On the other hand, Alexei Oreskovic and Sue Zeidler argue that the company will have hurdles even if it does get bought out.  Yahoo! made many desperate attempts to grow revenue this year, such as its attempts to purchase foursquare and Groupon.  According to one analyst, “making Yahoo! bigger or smaller will not accomplish anything.”  Yahoo! is the 2nd most popular search engine behind Google, but it has failed to find growth in page views or new business.  From a private equity investor’s point of view, Yahoo! may simply be attractive because of the steady cash flow it generates, if nothing else.

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Blackstone Buying Failed Banks with Aid of Former Bank President Oates

Thursday, March 18th, 2010

While TPG recently returned more than $2 billion in commitments to purchase failed banks, Blackstone has found a former bank President who is guiding them to buy financial institutions in the United States, a very risky, but potentially lucrative endeavor.

According to Ms. Thornton and Mr. Keehner, “Blackstone Group LP, the world’s largest private-equity firm, is in preliminary talks to raise $1 billion to buy failed banks, according to a person with knowledge of the discussions.

The New York-based firm is working with R. Brad Oates, a former president of Bluebonnet Savings Bank, to raise the funds for a blind pool, said the person, asking not to be named because the information is private. Blind pool investors usually back a single management team without having a say in what company it will acquire.

Peter Rose, a spokesman for Blackstone, declined to comment.

Buyout firms are seeking bargains as lenders fail at the fastest pace since 1992. Regulators have seized at least 160 lenders since Jan. 1, 2009, and the FDIC’s confidential list of “problem” banks stands at 702 with $402.8 billion in assets, according to a Feb. 23 report.

Related Cos. founder Stephen Ross and partners Jeff Blau and Bruce Beal Jr. raised about $1.1 billion last month to help their SJB National Bank acquire a seized U.S. lender. Among their investors are New York hedge-fund firm Elliott Management Corp. and David Einhorn’s Greenlight Capital Inc., a person with knowledge of the matter said last month.

Regulators have been debating how much leeway to give private buyers of failed banks because of concern that they may take too much risk with federally insured deposits. Some investment groups have recruited former bankers as officers to reassure regulators.

William Isaac, the Federal Deposit Insurance Corp.’s former chairman, is also leading a group of ex-regulators and bankers raising $1 billion to buy failed lenders in the U.S. Southeast, a people briefed on the plan said last month.

Last May, Blackstone partnered with WL Ross & Co. and Carlyle Group to buy BankUnited Financial Corp. The group agreed to inject $900 million and named John Kanas, the former head of North Fork Bancorp, to run the Florida lender after it collapsed.”