Feds Probe UBS Tips Blackstone CEO says public markets ‘over-rated’ TPG’s Bonderman plays down size of private equity Public or private equity? They will become more alike Lehman Trio Earns A ‘Low’ $92.3 Million MatlinPatterson seeks $4.5 billion for new fund
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Goldman Partner Joins Top Ranks At NYSE Heard on the Street: Subprime Game’s Reckoning Day JPMorgan Chase banker tipped for Treasury Carl Icahn Invests $50 Million in Motricity Electronic Arts Lures Back Riccitiello to Be Its CEO Temple-Inland Revamp Wins Icahn’s Backing Gap Reverses Pressler, Shuts a Niche Chain Cruise’s unit at MGM near funding deal
Feds Probe UBS Tips – New York Post
Federal regulators are zeroing in on analysts at UBS for giving hedge fund traders advance notice of stock rating changes, The Post has learned.
The Securities and Exchange Commission and federal prosecutors in New York could move as early as this afternoon to file civil and criminal charges against the UBS analysts. A source involved with the probe said authorities are also eyeing an employee of another investment bank.
The Post was unable to learn the identity of either the UBS researcher or the second investment bank….
Blackstone CEO says public markets ‘over-rated’ – Reuters
Raising private equity money through the public market is not yet a viable option for buyout firms, Blackstone Group Chief Executive Stephen Schwarzman said on Tuesday.
Schwarzman’s comments came amid speculation more private equity funds will seek public money after the success of the initial public offering this month of Fortress Investment Group LLC (FIG.N: Quote, Profile, Research), a private investment fund.
"I think the public markets are over rated," Schwarzman said, speaking on a panel at the annual Super Return private equity conference…..
TPG’s Bonderman plays down size of private equity – Reuters
Private equity, despite the outsized attention being paid to it, remains tiny compared to the public marketplace, but is bound to grow much larger, Texas Pacific Group co-founder David Bonderman said on Tuesday.
Bonderman’s comments come a day after his firm took part in the largest leveraged buyout in history, and amid a heated debate over private equity in Europe, which has reached the UK Parliament, the European Union and the World Economic Forum.
Buyout firms have found themselves under fire from British unions, which are taking aim at job cuts by private equity firms and calling for an end to tax breaks that make leveraged takeovers possible….
Public or private equity? They will become more alike – The Times of London
Imagine the corporate landscape five years from now. Will it be possible to tell the difference between companies owned in accordance with the public equity model and those that operate under private equity ownership? Save for some technicalities, such as having shares listed on public markets, it may be difficult.
The probable $45 billion takeover of TXU by a consortium of private equity partners including KKR, Texas Pacific, Goldman Sachs and Lehman Brothers represents a significant milestone on the route. The sheer size of the deal, when thought of in terms of the amount of capital that will probably be transferred, means that the boundaries will begin to blur. That is certainly the case when one considers that the bulk of cash invested in the public quoted companies comes from the same pension savings pot as that which finances most private equity investment funds…..
Lehman Trio Earns A ‘Low’ $92.3 Million – Wall Street Journal
Lehman Brothers Holdings’ three highest-paid officers pulled in $92.3 million in 2006, a payday that despite its size trails the packages doled out to some Wall Street rivals.
Lehman, which saw its net income rise 23% last year to a record $4 billion, paid Chairman and Chief Executive Richard Fuld $40.49 million, President Joseph Gregory $33.49 million and strategy head David Goldfarb $18.58 million, according to a filing with the Securities and Exchange Commission. Those totals include slices of restricted stock awarded in 2000 that vested at the end of Lehman’s fiscal year in November.
Excluding $12.5 million in previously awarded stock that vested in 2006, Mr. Fuld’s pay package fell for the second straight year. His cash bonus was more than halved to $6.25 million, and his newly awarded restricted stock was valued at about $10.9 million, down from $14.9 million in 2005…..
MatlinPatterson seeks $4.5 billion for new fund – Reuters
Distressed debt specialist MatlinPatterson LP is looking to double its assets under management this year to $8 billion in a new fundraising aimed at benefiting from an expected rise in defaults, people familiar with the matter said on Monday.
New York-based MatlinPatterson, which currently manages $3.9 billion, is looking to raise $4.5 billion by mid-year for its third buyout fund — its largest fundraising to date, these people said.
The move comes amid an expected rise in the historically low junk bond default rate of less than 1 percent last year, as debt-strapped companies found easy access to debt refinancings. However, recent bankruptcies among subprime mortgage lenders and the looming threat of interest rate rises have heightened concerns that default rates could be set to rise in other debt-laden industries….
Goldman Partner Joins Top Ranks At NYSE – Forbes
NYSE Group has brought in another Goldman Sachs executive to help run the place.
On Monday, the Big Board announced the hiring of Duncan Niederauer, a Goldman managing director, to be president and co-chief operating officer. He joins John Thain, former president of Goldman, who is now chief executive of NYSE (nyse: NYX – news – people ).
Niederauer will look over NYSE’s cash equities operations, including institutional and member firm group sales and client services for both the exchange floor and the electronic network acquired in last year’s merger with Archipelago Holdings….
Heard on the Street: Subprime Game’s Reckoning Day – Wall Street Journal
The worst may be yet to come for mortgage lenders. And that could add to investor nervousness.
Shares of companies that specialize in lending to riskier borrowers or offer unconventional loans have tumbled because of concerns over how rapidly these mortgages are going sour.
If these so-called subprime borrowers continue to have problems paying their debts, the lenders that target them likely will have to boost how much money they set aside for bad loans, cutting into their bottom lines. That could mean even lower stock prices….
JPMorgan Chase banker tipped for Treasury – Financial Times via MSNBC
The White House is set to announce the nomination of Tim Ryan, a banker at JPMorgan Chase, to be the US Treasury’s top international official.
If confirmed by the Senate, Mr Ryan will succeed Tim Adams, the under-secretary for international affairs, who recently announced his intention to leave by the summer.
Mr Ryan, vice-chairman of financial institutions and governments at JPMorgan Chase, is a seasoned former bank regulator who served in the George H.W. Bush administration and played a central role in the clean-up after the savings and loan crisis of the early 1990s….
Carl Icahn Invests $50 Million in Motricity – BusinessWire
Motricity, a leading provider of mobile content services and solutions, today announced the completion of $50 million in equity funding from Carl Icahn, through an affiliated company, along with the appointment of Brett Icahn, an investment analyst with Icahn Associates and affiliated companies, to the Motricity board of directors.
“Carl has proven himself as one of the leading investors of all time, with an incredible ability to identify top performing companies and drive shareholder value,” said Ryan Wuerch, Motricity chairman and CEO. “This investment bolsters our balance sheet and positions us to continue to aggressively grow the business and consolidate the industry.”
Over the past year, Motricity’s business has expanded substantially, quadrupling its customer base to include some of the leading wireless operators and media and entertainment companies, including Cingular, Alltel, Sprint, Tracfone, MTV, BET, NBC, Universal Music Group, Warner Music Group, Turner and several others…..
Electronic Arts Lures Back Riccitiello to Be Its CEO – Wall Street Journal
John Riccitiello, co-founder of a high-profile private-equity firm in Silicon Valley, Calif., is returning to Electronic Arts Inc. to assume the top job from Larry Probst, the long-serving chief executive officer of the world’s largest videogame publisher by sales.
Mr. Riccitiello resigned as EA’s president and chief operating officer several years ago to help establish Elevation Partners, a private-equity firm with $1.9 billion in committed capital that counts among its co-founders veteran technology investor Roger McNamee and Bono, lead singer of rock band U2.
Mr. Riccitiello, 47 years old, has resigned from Elevation and will become CEO of EA on April 2. Mr. Probst, 56, will remain executive chairman of EA’s board and plans to continue working full-time at the Redwood City, Calif., company…..
Temple-Inland Revamp Wins Icahn’s Backing – Wall Street Journal
Temple-Inland Inc. joined the ranks of North American forest-products companies announcing major restructurings when it said Monday it would spin off its financial-services and real-estate operations and sell its timberlands.
The company, which along with other forest-products companies has been hurt by the housing slowdown, will retain its corrugated-packaging and building-products manufacturing operations.
The stock traded recently at $62.70, up $7.75, or 14%, on the New York Stock Exchange.
The move comes as Carl Icahn has been on the prowl. He recently launched a proxy fight, nominating four directors to Temple-Inland’s 13-member board and suggesting the company spin off some businesses. As of last month he held a 6.7% stake in the company. Other major Temple-Inland shareholders known to favor maximizing shareholder value include Franklin Mutual Advisors, with a 9.36% stake, and Capital Research and Management, with a 3.15% stake……
Gap Reverses Pressler, Shuts a Niche Chain – Wall Street Journal
By choosing to close its fledgling Forth & Towne women’s clothing chain, Gap Inc. is repudiating former Chief Executive Paul Pressler’s decision to keep the retailer’s small projects afloat even as problems piled up at its key larger divisions.
Gap, of San Francisco, opened 19 Forth & Towne stores over the past 18 months in a bid to tap the baby-boomer market, long considered underserved by women’s clothing stores that tended to focus on teens and young adults. But Forth & Towne, which competed with department stores and specialty chains such as Chico’s FAS Inc., doesn’t appear to be a promising long-term investment, Gap said.
Gap will focus on turning around its flagship Gap and Old Navy brands, where sales and profits have been shrinking since the second half of 2004. The company’s bigger brands, which also include Banana Republic, have grappled with slow traffic, bloated inventory and deep discounting that has cut into profits….
Cruise’s unit at MGM near funding deal – Los Angeles Times
Wall Street may be ready to show Tom Cruise the money.
Metro-Goldwyn-Mayer Inc.’s long dormant United Artists movie unit — which Cruise and his producing partner are attempting to resuscitate — is close to raising about $500 million to finance a slate of movies over the next few years.
The money would pay the cost of making prints of the films and advertising them, as well as the cost of making them.
People close to the talks cautioned that the deal with expected lead investment bank Merrill Lynch wasn’t final, and that terms were still being negotiated. They said an agreement could take an additional 10 days to two weeks to complete….
