http://www.marketwatch.com/News/Sto...D130-7FEF-4FA5-BFC7-F61DBA59C0BD}&siteid=mktw Does anyone have any insight or links to explain in detail how these deals are made and who gets the fucking in the end? Clearly paying 30% premiums for companies isn't super healthy, especially when those companies are public and are already trading at some multiple of earnings. Therefore, I'm extremely curious who gets the ultimate screw in the end...I'm guessing it's the company itself while allowing execs to get off easy.
Eventually this will come to an end, BOL was taken private yesterday as well. It can only go on for so long.
I agree. But I want to see some info relating to how it all works. Probably won't until a bit later, months or years, as I expect that most of these deals are only enriching the dealers and the companies will eventually be screwed. I'd gues these deals could potentially be viewed as death spirals, no? They must have some sort of downward clause that allows the debtor to collect. Considering that they're paying 30% premiums for companies that already trade at many multiples, ADS at 30X or so, that means they're paying extraordinarily high premiums. I DEMAND TRANSPARENCY!
You will find out how it works when it all falls apart and cnbc does these discussions everynight for weeks. Right now there seems to be no risk in these HIGHLY leveraged buyouts.
I agree...it's amazing to me. I think the deals must be death spiral deals...I don't see how anyone could be the LENDER in this case and take on that risk. There's either too much badly managed money floating around or these deals are going to end up with the lenders owning large portions of these companies in exchange for overpaying now. Time will tell.
HERES ANOTHER THAT HAPPENED TODAY!!! NEW YORK (AP) -- More offers may be coming for data management company Acxiom Corp., which agreed to be taken private for $2.25 billion, a JPMorgan analyst said Thursday. ValueAct Capital, the largest Acxiom shareholder, and Silver Lake Partners teamed up for the bid, which Acxiom accepted after the bell Wednesday. The offer translates to $27.10 per Acxiom share, a 14.5 percent premium to the stock's Wednesday closing price of $23.67. The firms would each own half of the Little Rock, Ark.-based company and assume $756 million in debt.
Sadly I barely even look at the deals for less than $5B anymore...that's a sign of how fucked everything is. The sad thing is that all these deals being packaged will just add to the bottom line of the finance companies and the bulls will use it as fuel.