The Morning Leverage: Back From The Blizzard
The Wall Street Journal December 29, 2010
In this morning’s media roundup:
News: Blackstone is ringing in the New Year with a CNY300 million commitment from Chinese property developer Shanghai Jinfeng Investment Co., Dow Jones Newswires’ Joy Shaw reports. This edges the firm ever closer to the CNY5 billion target it set for the fund, which launched in the fall of 2009.
Meanwhile, on another continent, Blackstone is entering the fray for Australian shopping-center owner Centro Properties Group, The Wall Street Journal reports. The firm is interested in Centro’s $9.5 billion U.S. portfolio, which consists of some 600 properties housing brands like Kroger, TJ Maxx and Marshalls. So basically everywhere our moms shop.
Getting BJ’s appears to be at the top of Leonard Green’s list of New Year’s Resolutions, with the firm possibly launching a hostile bid for the wholesaler if it does not initiate an auction in the next few weeks, The New York Post writes. A deal would be the third in a string of large holiday purchases for the firm, following a $3.5 billion offer with TPG for J. Crew in November and a $1.6 billion deal for Jo-Ann Stores earlier this week. The WSJ’s John Jannarone has some details on that deal here.
Budweiser, which returned to Vietnam two years ago for the first time since U.S. troops departed in 1975, is facing a new conflict, as its local distributor Gannon International has entered into a complicated legal dispute with former CEO Walter Blocker and private equity firm Ignition Partners. Gannon alleges Blocker breached his fiduciary duties and stole money. Blocker calls the allegations against him and Ignition “baseless and meritless.” Read on via The Financial Times here.
Analysis: Private equity is an indelible part of China’s future, but state officials predict that it will follow a “’different path’ from overseas peers,’” Bloomberg News reports. Given that funds in the country are generally linked to state-owned institutions, portfolio investments have the added value of being backed by the government, said China Investment Corp. Vice President Xie Ping, which separates the Chinese PE industry from others.
Fiber optics are lighting up once again, thanks in part to interest from private equity, The Wall Street Journal reports. But with increased deal flow comes increased deal prices- M/C Venture Partners, which has done a handful of add-on deals this year for fiber optics portfolio company Lightower Fiber Networks, said buyers are paying more than 10 times cash flow for acquisitions, compared with five to seven times just a few years ago.
Just For Fun: It’s a well-known fact that Chuck Norris does not sleep, he waits. Less well-known is that he has starred in a series of T-Mobile commercials in the Czech Republic, according to The Wall Street Journal. Just to be clear, we’re not poking fun or anything. We have a healthy fear of the beard. Because even Google is afraid of Chuck Norris.