The Graveyard is Getting Crowded

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Anonymous

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Good article on private equity bankruptcies in the readers digest

http://blogs.wsj.com/deals/2009/08/18/private-equitys-graveyard-is-getting-crowded/


But it is the mega PE-backed bankruptcies, such as Cerberus Capital Management’s stake in Chrysler and Lightstone Group’s stake in the Extended Stay hotel chain, that have grabbed the headlines. Pehub.com estimates this is only the tip of the tip iceberg for big, billion dollar bankruptcies because “the real flood of mega buyout debt begins to mature in 2011.”
 






well there ya go, the article mentions warburg by name and says they had a couple companies go bankrupt under their umbrella. Explains why they aren't paying too close of attention to B&L. At least it is staying afloat. However, when it does sink, and it will sink, it will be a major back breaker to Warburg.
 






They'll just move on to the next set of deals after the squeeze every possible cent out of this shop. This is what they've done time and time again. It's like an MD pronouncing a patient dead; they just move on to their next set of duties, be it clinic, OR, etc.
 






When CCS medical when bankrupt see at

http://www.bizjournals.com/tampabay/stories/2009/11/16/story7.html

Warburg paid $645 million and in four years it was valued at $286 million with $522 million in debt.

I wonder how much Warburg took out of the company to reduce its value so much. The banks that give out loans to private equity and the private equity fund must put controls in place to limit their liabilities in the event of bankruptcy. Also, how much money did CCS Medical have to give to Warburg year after year prior to filing for bankruptcy?

Since Warburg Pincus is doing nothing big to control costs at B&L perhaps it won't go bankrupt or maybe Warburg Pincus will actually find a way to make money off this deal in bankruptcy court?
 






If your interested in the real end game for this company check out

http://findarticles.com/p/articles/mi_hb3463/is_201006/ai_n53928315/

The Private-Equity Time Bomb

"Unlike a bona fide venture capitalist, a private-equity company does not add net equity capital. Mainly, it adds debt, which in turn finances windfall extractions, often at the expense of the operating company, as in the case of Simmons. "The idea that PE firms put cash into companies was a widely held misconception," he writes. The victims are workers (whose wages, benefits, and pensions are squeezed), suppliers, creditors, communities, and the very existence of once proud and viable American corporations. And warns Kosman, as these companies increasingly enter bankruptcy, private equity will cause yet another credit crisis comparable to the sub-prime disaster."

The banks should be forewarned of loaning to this company. Since there is little chance of an IPO or sale of this company the only way to continue sucking money out of this deal is to get more loans from banks. BANKS BEWARE!
 












All the talk about bankruptcy, etc., only proves the previous poster(s) know absolutely nothing about business. B+L may have 'third-place' products across the board, but they are still profitable. Research has shown that a company with third-place products typically produces disgruntled employees that have too much time on their hands to research non-existent problems.
 






Anonymous said:
All the talk about bankruptcy, etc., only proves the previous poster(s) know absolutely nothing about business. B+L may have 'third-place' products across the board, but they are still profitable. Research has shown that a company with third-place products typically produces disgruntled employees that have too much time on their hands to research non-existent problems.
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This has got to be KK drinking the Koolaid. You can tell they don't show her the books.
 


















Anonymous said:
Seems like 2011 is the year for things to happen at this company.
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Yep. Most of it won't be good for the reps but ignorance is bliss. 2011 will be a year where the reps get held more than accountable for things outside their scope of control. This makes them work harder like their jobs count on it and keeps them distracted from the real happenings at the top of the company.
 












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