DealBook: Blackstone's 4th-Quarter Earnings Fall Steeply

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Edited by Andrew Ross Sorkin

TODAY'S TOP HEADLINES | Monday, March 10, 2008 M & A: After Tata Deal, What Next for Ford? BANKING: As Good as Cash, Until It's Not PRIVATE EQUITY: Tight Credit, Tough Times for Buyout Lords HEDGE FUNDS: Margin Calls Pummel Hedge Funds OFFERINGS: Shenzen Plans Start-Up Stock Exchange VENTURE CAPITAL: Gigya Raises $9.5 Million LEGAL: Countrywide Said to Draw Criminal Inquiry TOP STORY Blackstone's 4th-Quarter Earnings Fall Steeply The Blackstone Group reported on Monday a net loss of $170 million for its fourth quarter, a sharp reversal from the same time in 2006 amid expenses tied to the private equity firm's initial public offering and a choppier credit market that has hurt its businesses. Under an accounting metric that accounts for expenses related to its I.P.O. last year, Blackstone reported a gain of $128 million, which still represented an 86 percent drop from the same time in 2006. That figure comes out to about 8 cents per unit; analysts surveyed by Bloomberg News estimated profit of 20 cents a share. "The operating environment in the second half of the year presented significant challenges," Blackstone's chairman and chief executive, Stephen A. Schwarzman, said in a statement. Go to Item from DealBook» Read More Add a comment ADVERTISEMENT Back to Top MERGERS & ACQUISITIONS As Ford Motor closes in on a deal to sell its Jaguar and Land Rover brands, the struggling automaker could be nearing the end of the road on asset sales that have been cushioning its turnaround. Go to Article from Reuters via The International Herald Tribune» Read More Add a comment German sports car maker Porsche denied on Monday it is seeking to increase its stake in Volkswagen to 75 percent, noting talk of such a move "overlooks the realities in VW's shareholder structure." Go to Article from Reuters via The New York Times» Read More Add a comment Nine months into the credit crunch, The Deal Professor takes stock of MAC clauses and the big role they have played in collapsed deals. Go to Article from The Deal Professor» Read More Add a comment Microsoft would not rush to merge its technology platform with Yahoo's after a takeover of the Internet company, even if meant delaying some of the potential benefits to shareholders from any deal, Microsoft's chief software architect told The Financial Times. Go to Article from The Financial Times» Read More Add a comment HSBC Holdings, Europe's largest bank by market value, has applied for regulatory approval in China to raise its stake in Bank of Communications to 40 percent, the Chinese lender said. Go to Article from Bloomberg News» Go to Article from Reuters via The New York Times» Read More Add a comment Autogrill, the biggest manager of airport restaurants, agreed to buy a BAA unit and the shares it doesn't own in Aldeasa for $1.5 billion, becoming the world's largest owner of duty-free stores. Go to Article from Bloomberg News» Read More Add a comment Nationwide Financial said Monday that its parent company, Nationwide Mutual, has offered to buy the shares in the financial services firm that it does not own for $2.2 billion in cash. Go to Item from DealBook» Go to Nationwide Financial Press Release via Business Wire» Read More Add a comment EADS, currently battling opposition in Congress to a U.S. Air Force deal, wants to identify up to two acquisitions in the United States this year, according to Reuters, which cited an internal memo. Go to Article from Reuters via The New York Times» Read More Add a comment With profitability in the music business getting harder to come by, the auction of London label the Chrysalis Group could prove interesting. Go to Article from The Deal.com» Read More Add a comment Acquisition activity in the so-called ethnic foods market has been cooking, as the Hispanic and Asian populations continue to increase in the U.S. and mainstream America gets a bigger appetite for an ever-widening range of cuisines, The Deal.com reports. Go to Article from The Deal.com» Read More Add a comment Back to Top INVESTMENT BANKING Investors in acution-rate notes are finding themselves in Wall Street's version of the Hotel California, The New York Times's Gretchen Morgenson writes in her Sunday column: they have checked into an investment they can never leave. Go to Article from The New York Times» Read More Add a comment Legg Mason, the asset management company, threw its short-term money funds a new lifeline on Friday by securing a $150 million letter of credit to prop up portfolios exposed to troubled structured investment vehicles. Go to Artciel from Reuters via The New York Times» Read More Add a comment Subprime-related losses at global financial institutions have so far totaled as much as $215 billion, with about 55 percent of that coming from the United States, the head of Japan's financial regulator said on Monday. Go to Article from Reuters via The New York Times» Read More Add a comment Goldman Sachs disclosed last year's hefty pay packages for five of its top executives, including $67.5 million each awarded to its co-presidents, Gary Cohn and Jon Winkelried. Go to Article from Bloomberg News via The New York Times» Go to Item from DealBook» Read More Add a comment As Goldman Sachs continues to make changes to its top ranks, the investment bank has promoted Tim Ingrassia to head its mergers and acquisitions practice in the Americas, according to an internal memorandum obtained by DealBook. Go to Item from DealBook» Read More Add a comment Will collateralized debt obligations make a comeback at some point? The Deal.com looks at the future of these structured finance vehicles. Go to Article from The Deal.com» Read More Add a comment Lawyers for E. Stanley O'Neal, Merrill Lynch's former chief, unsuccessfully sought a $45 million cash severance payment as he was being pushed out, according to documents obtained by a House committee investigating pay practices. Go to Item from DealBook» Read More Add a comment Back to Top PRIVATE EQUITY The Ides of March has arrived early for the buyout lords of Wall Street, as the intensifying credit crisis humbles some of the industry's once-celebrated deal makers. Go to Article from The New York Times» Read More Add a comment Carlyle Capital, an affiliate of private equity firm the Carlyle Group, said on Monday it has asked lenders for a standstill agreement as it faces more than $400 million in margin calls. Go to Article from Reuters via The New York Times» Go to Article from The New York Times» Go to Article from Fortune via CNN Money» Read More Add a comment A consortium of private equity firms, including buyout giants the Blackstone Group and Kohlberg Kravis Roberts, are actively considering launching a takeover bid for Richard Branson's Virgin Media, despite continuing turmoil in the credit markets, according to The Observer. Go to Article from The Observer» Read More Add a comment The Blackstone Group, the private equity company that last year walked away from take over talks with Britain's FKI, has hired bankers to examine making a counterbid for the engineering group, according to The Telegraph. Go to Article from The Telegraph» Go to Previous Item from DealBook» Read More Add a comment In the run up to Taiwan's presidential election, the Central Bank of China -- the island's central bank -- says it is contemplating setting up a sovereign wealth fund. Go to Article from Asia Investor via BusinessWeek» Read More Add a comment Warburg Pincus has agreed to lower the purchase price and extend the deadline for some shares certain MBIA executives have committed to buy, which will essentially lower the investment amount struggling MBIA will receive. Go to Article from The Associated Press via CNN Money» Read More Add a comment BCE, seeking approval for a 52 billion Canadian dollar ($52.4 billion) buyout, scored a victory after a Canadian judge dismissed a lawsuit by a group of bondholders opposed to the deal. Go to Article from Bloomberg News» Go to Article from The National Post» Go to Related Article from The National Post» Read More Add a comment BC Partners, a British private equity firm, said Monday that James Rubin and Daniel Selmonosky would join the firm as senior partners as part of an expansion of its New York office. Go to Press Release from BC Partners» Go to Item from DealBook» Read More Add a comment Back to Top HEDGE FUNDS At least six hedge funds have been forced to liquidate or sell holdings since mid-February because of a "crackdown" by jittery lenders, Bloomberg News reports. Go to Article from Bloomberg News» Read More Add a comment Rebel investor Knight Vinke Asset Management renewed its attack on HSBC's management over the weekend, slamming their treatment of shareholders as "truly irresponsible." Go to Article from The Telegraph» Read More Add a comment A meeting between CNet Networks' board of directors and Jana Partners, the hedge fund seeking to take replace a majority of the troubled company's directors, didn't go so well, TechCrunch reports. Go to Item from TechCrunch» Read More Add a comment As Alliance Data Systems' deal with the Blackstone Group remains in limbo, a notable investor seems to be trimming its ADS stake. Go to Item from DealBook» Read More Add a comment A challenge by two hedge funds looking to elect a slate of directors to The New York Times Company provokes a larger question: What can the Times Company do to battle the industrywide downturn that has brought sharply reduced budgets, smaller newsrooms and the sale of newspapers across the country? Go to Article from the New York Times» Read More Add a comment Back to Top I.P.O. / OFFERING Shenzhen is ready to start a Nasdaq-style second exchange for start-up shares as soon as the Chinese government gives it the go-ahead, the mayor of the southern Chinese city said Sunday. Go to Article from Reuters via The International Herald Tribune» Read More Add a comment Major contractor China Railway Construction's shares rose by a smaller-than-expected 28 percent early Monday after an initial public offering that raised $5.4 billion -- the biggest I.P.O. so far this year. Go to Article from The Associated Press via The International Herald Tribune» Read More Add a comment Shares of Orbitz have tumbled since its July 2007 public offering, which some critics thought came too soon after Blackstone Group acquired its parent company. Go to Item from DealBook» Read More Add a comment Back to Top VENTURE CAPITAL Gigya, a company that allows widget makers track how advertising performs on their Web applications, has raised $9.5 million in a second round of funding from Mayfield Fund and existing investors Benchmark Capital and First Round Capital. Go to Article from VentureBeat» Go to Article from Mashable» Read More Add a comment Giant Realm has raised $3.5 million to expand its entertainment web site for young male adults. Go to Article from VentureBeat» Read More Add a comment Jivox, which provides an online video advertising platform for businesses, said it raised $2.7 million from a group led by venture firm Opus Capital. Go to Press Release from Jivox via PR Web» Go to Article from Online Media Daily» Read More Add a comment Back to Top LEGAL The federal authorities have opened a criminal inquiry into Countrywide Financial for suspected securities fraud as part of the continuing fallout over the mortgage crisis, according to The New York Times. Go to Article form The New York Times» Read More Add a comment In pointed exchanges with Congressional lawmakers Friday, three prominent financial executives defended the multimillion-dollar pay packages they received even as their companies were brought to their knees by the spreading credit crisis. Go to Article from The New York Times» Read More Add a comment Thornburg Mortgage, the second-largest independent mortgage lender in the United States, said Friday that its survival was at stake because it was unable to meet $610 million of margin calls. Go to Article from Reuters via The New York Times» Read More Add a comment Nearly 10 years after he left, Franco Bernabé again faces the task of running Telecom Italia as chief executive, and he will probably need all the skills he honed at the investment bank Rothschild to reduce debt. Go to Article from Reuters via The International Herald Tribune» Read More Add a comment Get home delivery of The New York Times for as low as $3.15 a week.

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