The Daily Caveat is written by Michael Thomas, a recovering corporate investigator in the Washington, DC-area. [More]
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11/20/2006
Unlucky 13: Private Equity Groups Face Pricefixing Suit
Unlucky 13: Private Equity Groups Face Pricefixing Suit
The big names in the suit include Kohlberg Kravis Roberts, Carlyle Group, Clayton, Dubilier & Rice, Silver Lake Partners, Blackstone Group, Bain Capital, Thomas H Lee Partners, Texas Pacific Group, Madison Dearborn Partners, Apollo Management, Providence Equity Partners, Merrill Lynch and Warburg Pincus. At issue are so-called private equity "club deals" in pubic-to-private transactions.
Supposed club members would allegedly share information about their own bids and block out competition in order to pick up public companies at artificially low prices. Investors involved in the 13 company lawsuit are alleging that due to this price-fixing they lost significant coin on the private equity deals. Some of the transactions highlighted in the complaint include: Univision Communications Inc. and Harrah's Entertainment Inc. (the case includes former investors in each company)
There have been some 21 "club" buyouts announced in 2006, valued at over $176 billion. Back in August, The Daily Caveat called your attention to the "club deal" issue, which was getting a close look by regulators. That look got even closer a few weeks back when the Justice Department announced they were initiating a probe into anticompetitive practices in the private equity realm. The Carlyle Group, Clayton Dubilier & Rice, Kohlberg Kravis Robert, Silver Lake Partners and Merrill Lynch all received requests for information in relation to the ongoing investigation.
-- MDT
Supposed club members would allegedly share information about their own bids and block out competition in order to pick up public companies at artificially low prices. Investors involved in the 13 company lawsuit are alleging that due to this price-fixing they lost significant coin on the private equity deals. Some of the transactions highlighted in the complaint include: Univision Communications Inc. and Harrah's Entertainment Inc. (the case includes former investors in each company)
There have been some 21 "club" buyouts announced in 2006, valued at over $176 billion. Back in August, The Daily Caveat called your attention to the "club deal" issue, which was getting a close look by regulators. That look got even closer a few weeks back when the Justice Department announced they were initiating a probe into anticompetitive practices in the private equity realm. The Carlyle Group, Clayton Dubilier & Rice, Kohlberg Kravis Robert, Silver Lake Partners and Merrill Lynch all received requests for information in relation to the ongoing investigation.
-- MDT
Labels: Department of Justice
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