I'm sure KKR is irked that the Blackstone Group LP (NYSE: BX) is public. In fact, the company had its IPO at the peak in the market, picking up billions from investors. And, since the transaction, Blackstone has used its stock to pull off deals, such as the purchase of GSO Capital.

But, according to a piece in the Wall Street Journal (subscription required) it seems that KKR is still gunning for a public offering. True, KKR did file an S-1 about a year ago. But, the last amended filing was in November.

Then again, KKR has been on a hiring spree - bulking up its executive suite. Some of the positions include: general counsel, chief compliance offer, CTO, chief human-resources officer and so on.

In other words, why have such people unless a company wants to be public?

If anything, the lull in the private equity market may be a blessing. Keep in mind that KKR hasn't struck a buyout deal this year. So, what better time than now to build up the infrastructure?

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Permalink | Email this | Linking Blogs | Comments

For deals of $2 billion or less, private equity firms are showing interest. However, the problem is: cheap valuations.

This is what the board at Chemtura (NYSE: CEM) found out the hard way. Late last year, the company retained Merrill Lynch (NYSE: MER) to explore "strategic alternatives." While some private equity firms showed interest - like Blackstone Group LP (NYSE: BX) and Apollo Management LP -- there wasn't much appetite to pay a premium. So, Chemtura has ended the process. Instead, the company will focus on restructuring (such as divestitures).

Chemtura has an interesting mix of businesses, such as plastic additives, pool and spa products and the lubricant components. For 2007, the company generated $3.7 billion in revenues.

However, with the energy crisis, the environment has been particularly tough for Chemtura. Just look at rival Dow Chemical (NYSE: DOW), which has increased prices two times during the past month.

Of course, Wall Street was disappointed with the Thursday's news on Chemtura's potential buyout, as the stock price plunged 22% to $6.34.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Permalink | Email this | Linking Blogs | Comments

It's been tough for private equity firms to exit investments. Basically, the valuations are much lower - and the IPO market is particularly weak. And, with the credit crunch, it's really impossible to recap portfolio companies (such as with dividend payouts).

Despite all this, the Blackstone Group LP (NYSE: BX) may buck the trend. According to a report in Bloomberg.com, it looks like the firm may be able to sell one of its portfolio holdings, Groupe Vitalia, a hospital operator based in France.

In fact, it appears that Groupe Vitalia has attracted four serious bidders - and that the deal may come to $2.2 billion. Some of the bidders include CVC Capital Partners, LBO France, Gruppo Ospedaliero San Donato and Batipart SA. In other words, it's a mix of private equity players and strategic buyers.

Interestingly, Blackstone has been able to bulk up Groupe Vitalia with a variety of bolt-on acquisitions. All in all, it 's a smart strategy that may see a rare pay off.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Permalink | Email this | Linking Blogs | Comments

Robert Phillips is a veteran of the energy world. He was the CEO of Enterprise Products Partners L.P. (NYSE: EPD), a major natural gas player. Before this, he was a chairman of GulfTerra and the CEO of Eastex Energy, Inc.

Now, Phillips has a new venture: Crestwood Midstream Partners LLC. In fact, he arranged a cool $500 million investment from the Blackstone Group LP (NYSE: BX) and GSO Capital Partners, an affiliate of Blackstone.

Basically, Phillips will use his extensive background to build a pipeline operation through internal development and acquisitions (the entity got its start in November 2007, with the help of Kayne Anderson). And, of course, in light of the energy problems in the US, the timing looks spot-on.

With its strong backing, Phillips should have little trouble attracting top-notch talent. He has already hired Joel Moxley, who was senior vice president of gas processing at Crosstex Energy Services, L.P., and Brad Graves, who was the executive vice president of business development at Genesis Energy, L.P.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Permalink | Email this | Linking Blogs | Comments

UPS (NYSE:UPS) is down about 5% after reporting a cut in earnings forecasts.

ASML Holding (NASDAQ:ASML) is up 4% on an upgrade from Goldman.

Cooper Tire (NASDAQ:CTB) is off almost 4% after it cut North American production on lower demand.

Blackstone (NYSE:BX) is off 3% after it filed for the sale of over 800 million shares.

Stocks may trade differently in the pre-market than they do in the regular session.

Douglas A. McIntyre is an editor at 247wallst.com.

Permalink | Email this | Linking Blogs | Comments

In theory, private equity is a simple business. Basically, it's about buying a company at a cheap price and then eventually selling it for a premium. Oh, and because of the large amount of debt, you can essentially leverage the returns.

Of course, the folks at the Blackstone Group LP (NYSE: BX) know this game very well. In fact, they have been doing it since the late 1980s.

However, this raises an interesting question: If Blackstone wants to buy from you or sell an asset to you, should you be concerned? Does the firm know something that you don't?

It's a good question to ask. After all, about a year ago, Blackstone went public with much fanfare. Interestingly enough, it marked the peak of the private equity market. Yet, Blackstone was able to snag a cool $4.1 in the offering. Even the Chinese government invested $3 billion in the firm.

Well, Bloomberg.com has a good piece on the topic.

First of all, Blackstone's stock is down more than 40% since its IPO, and things aren't looking so good (at least in the short-run).

Actually, if you took the time to read Blackstone's IPO documents, there were certainly many warnings about the business. Some of issues included volatile earnings, credit availability, the difficulties in managing deals, potential tax problems, and so on.

But who reads such things?

It looks like investors are still not reading much on Blackstone, though. If anything, there has been mostly avoidance.

So, isn't this the time to consider an investment? Perhaps so. It's hard to believe that private equity will fade away. Simply put, it's been a key part of the financial system since the 1970s.

With valuations low, this is definitely a good time for Blackstone to buy up companies, which is easier because of the firm's war chest. For example, the firm was able to snag GSO Capital Partners LP (a major player in the distressed debt market).

Moreover, Blackstone has a diverse platform, which includes investments in real estate, hedge funds and, of course, private equity. There has also been a move into emerging markets.

Keep in mind that Blackstone partners and employees own 80% of the firm -- and that there is a lock-up on many of the shares until 2016. In other words, they stand to get even richer if they continue to make the right investments.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Permalink | Email this | Linking Blogs | Comments

Apria Healthcare Group Inc. (NYSE: AHG), a home healthcare services company, has seen its shares plunge from $31.57 to $15.31 over the past year. But as of today, things got much brighter, as the shares spiked 26% to $20.

The Blackstone Group (NYSE: BX) has agreed to buy the company for $1.6 billion. Debt financing will come from Bank of America (NYSE: BAC), Wachovia (NYSE: WB) and Barclays Capital (NYSE: BCS).

Apria operates about 550 respiratory and infusion therapy facilities across the US and serves more than two million patients per year. For the latest quarter, Apria posted a 35.1% increase in revenues to $528 million (there was a nice boost from the Coram acquisition). Net income was $20.8 million.

However, Apria has had to deal with Medicare payment reductions. Although, as for Blackstone, this is something it can cope with since it will hold onto the company for a while and can restructure the Apria platform.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Read | Permalink | Email this | Linking Blogs | Comments

Early this year, The Blackstone Group LP (NYSE: BX) agreed to purchase GSO Capital Partners, a hedge fund that focuses on leveraged finance, for a cool $930 million. Stephen A. Schwarzman, Blackstone's CEO, said that the deal would create "one of the largest credit platforms in the alternative asset management business." Yes, it's an attractive space, especially in light of the credit crunch.

Moreover, Blackstone isn't wasting time in leveraging the GSO platform. According to a report in Bloomberg, it looks like it is raising a new fund that is focused on distressed debt.

True, there hasn't been a surge in defaults and bankruptcies, but such things usually have lag times, and if the economy remains sluggish, there are likely to be many distressed opportunities.

Although, the distressed investment market is getting crowded. Some of the recent players include the Carlyle Group and Oaktree Capital Management. In fact, Monarch Alternative Capital and Cerberus Capital Management LP are in the market raising their own distressed funds.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Read | Permalink | Email this | Linking Blogs | Comments

I'm not sure how management at Lehman Brothers Holdings Inc. (NYSE: LEH) has time to run the business. What's more, with all the turbulence, I'm wondering if many of the employees are working mostly on parsing rumors and fine-tuning resumes.

Of course, this week Lehman got rid of its CFO, Erin Callan and president, Joseph Gregory. The company also raised $6 billion, which was quite dilutive. So from Monday to Friday, the stock price plunged from $33 to $25.81.

Yet, by Friday, things were perking up. The stock price shot up 13.7%. Maurice "Hank" Greenberg, the, who is the former CEO of AIG (NYSE: AIG), said he bought shares. This was also the case with BlackRock (NYSE: BLK) and Putnam Investments.

But there was something else: Wall Street was abuzz with buyout rumors.

In fact, according to a report from CNBC, it looks like the senior management team of Lehman is meeting this weekend (which is a rare thing). Are they talking to possible suitors? Or, is it to review the figures for Q2? Both?

Despite all this, the fact remains that Lehman's potential suitors are also distressed. So, even if there is a deal, the valuation is likely to be muted.

But there is an interesting scenario: Blackstone Group LLP (NYSE: BX) as a buyer or major investor. The firm is well capitalized and may want an investment banking platform. Moreover, the firm's cofounders -- Stephen Schwarzman (CEO) and Peter Peterson (Senior Chairman) -- were formerly with Lehman (back in the 1980s).

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Permalink | Email this | Linking Blogs | Comments

Last year, the Chinese government invested a cool $3 billion into The Blackstone Group LLP (NYSE: BX). It was before the IPO and seemed to be a good bet.

Of course, it wasn't. The shares of Blackstone have plunged since.

Despite this, China is still hungry for private equity. In fact, according to a report in the Financial Times, the State Administration of Foreign Exchange of China has agreed to invest $2.5 billion in TPG's latest fund (which may reach as much as $20 billion).

Simply put, China is overflowing with cash, so why not seek out higher returns?

True, private equity is ailing right now, but then again, the investment horizon is for the long-term. And with lower valuations, private equity firms are positioned nicely to pick up some attractive buyouts.

Something else: TPG has a strong track record. And, by all accounts, the firm is continuing its winning ways, such as with its latest score in selling Alltel to Verizon Wireless, a joint venture of Verizon (NYSE: VZ) and Vodafone (NYSE: VOD).

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Permalink | Email this | Linking Blogs | Comments

Chemtura Corporation (NYSE: CEM), a chemical company, is the result of a merger of Crompton Corporation and Great Lakes Chemical Corporation back in 2005. Since then, the company has been "right-sizing" and "right-shaping" its organization with divestitures as well as more acquisitions. Some of the company's core competencies include plastic additives, seed treatments, pool and spa products, and urethane polymers.

Well, according to a report in The Wall Street Journal [subscription], it looks like The Blackstone Group LP (NYSE: BX) and Apollo Management LP are interested in purchasing Chemtura. True, it sounds like the talks are preliminary; but at the same time, private equity firms are hungry for deals, especially for valuations of $2 to $4 billion.

Blackstone and Apollo are highly experienced in the chemical space, and have had fairly good success. If anything, Chemtura is likely to find synergy with other portfolio companies.

However, a key hurdle is the operating performance of Chemtura. In Q1, the company posted a loss of $21 million or $0.09 per share. Simply put, it's been tough to deal with commodities inflation.

Although there is a silver lining; the crop protection business. The unit posted a 50% spike in operating income.

More importantly, Wall Street is taking the deal-talk seriously. In today's trading, Chemtura's stock is up 8% to $8.44.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Permalink | Email this | Linking Blogs | Comments

MAJOR PAPERS:

• Last December Chemtura Corporation (NYSE: CEM), a specialty chemicals company with a market cap of about $1.9B, said it might sell itself, and now The Blackstone Group LP (NYSE: BX) and Apollo Management are in talks to buy the company, the Wall Street Journal reported.
• In part one of a series to help explain the reasons why The Bear Stearns Companies (NYSE: BSC) collapsed, the Wall Street Journal said that the troubled firm was torn apart by executives who couldn't agree on what course to take, including raising capital and slicing mortgage and related bonds from its inventory. And each of about six attempts to raise capital fell part.

• The American investor and Berkshire Hathaway Inc (NYSE: BRK.A) chief Warren Buffett said the United States is already in a recession that is deeper and will last longer than the public expects, the Economic Times reported.
• According to the Telegraph, Barclays Plc (NYSE: BCS) is planning to sell Barclays Life Assurance Company, its life assurance arm, which has over GBP7B of funds under management. Sources believe potential bidders for the unit may include Pearl, Swiss Reinsurance Company (OTC: SWCEY), General Re, Canada Life and XL Re. Market commentators believe that on an embedded value basis, the unit is currently valued at around GBP1B.

Permalink | Email this | Linking Blogs | Comments

David Rubenstein, the co-founder of the Carlyle Group, recently predicted we'd see a comeback in private equity deals. Although, the transaction amounts would range from $2 billion to $4 billion.

Well, based on reports from the Wall Street Journal (subscription only), we may see a new deal soon.

That is, the Weather Channel is in the midst of an auction. So far, the leading bidders include: Time Warner (NYSE: TWX) and a partnership of GE (NYSE: GE) and the Blackstone Group (NYSE: BX). It looks like the auction is in the second round.

Now, the GE-Blackstone partnership is interesting. Keep in mind that Blackstone has a long history of such arrangements. Basically, it helps to alleviate the financial burden. Besides, Blackstone has a proven track record of showing cooperation with major corporate alliance partners.

And the price tag for a deal? The range is about $3 billion to $4 billion. Unfortunately, it looks like the parent company of the Weather Channel - Landmark Communications - wanted to fetch $5 billion. But the credit crunch is still taking a toll on valuations.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Permalink | Email this | Linking Blogs | Comments

Yesterday was a tough day in the markets, with the Dow falling 199 points. But, if you follow some of the legends of finance - such as Carl Icahn, T. Boone Pickens and The Blackstone Group's (NYSE: BX) Steven Schwarzman - you will notice that they are getting aggressive.

Keep in mind that these guys have been through multiple market cycles. And, if history is any worthy benchmark, it's during times of instability where the big money is made.

Pickens is focusing on the energy industry. He sees major demand/supply imbalances and is buying various stocks. He is also interested in natural gas and alternative fuels.

As for Icahn, he's doing what he does best - shareholder activism. He senses when companies are vulnerable and seems to relish an attack on corporate managements and boards. Of course, he's gearing up for a fight with Yahoo! (Nasdaq: YHOO). Interestingly enough, he persuaded Pickens to buy 10 million shares.

And, with Schwarzman, he's buying up the bank debt of companies that went private. Because Blackstone sees many deals, it has an extensive database of opportunities.

In other words, the legends of finance are confident in the long-term. They are making some big bets -- based on lots of experience and due diligence -- and not listening to the short-term noise. All in all, these are some valuable lessons for investors.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Permalink | Email this | Linking Blogs | Comments

About a year ago, the rage in private equity was the so-called megabuyout. It seemed like no company was immune. There was even talk of $100 billion dollar deals.

Of course, the credit crunch ended the megabuyout. In fact, it ended most of the activity for private equity folks.

Yet, according to the co-founder of the Carlyle Group, David Rubenstein, things are perking up [subscription required]. His firm - like other veterans, such as The Blackstone Group (NYSE: BX) - understands market cycles. After all, these players have dealt with variety of credit crunches, such as in 1991-1992, 1998 and 2001-2002.

So, Rubenstein predicts we'll see a pick-up in deals over the next few months. Although, the deals are likely to range from $2 billion to $4 billion -- with less debt. And expect more foreign deals.

Funny enough, Rubenstein seems to be leading the charge with its recently announced a $2.54 billion deal for a majority stake in Booz Allen Hamilton.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Read | Permalink | Email this | Linking Blogs | Comments

No doubt, Barack Obama is an amazing speaker. Even his opponents grudgingly agree.

Yet he has misspoken on several occasions. His comment that mentioned "bitter" Americans took a toll on his campaign. And he is being lampooned in the blogosphere and on talk shows for his slip that he had visited all "57 states."

Entrepreneurs can learn from his talents -- and his slip-ups. In other words, when making a pitch -- or a speech -- you need to be very careful what you say. You need to think like a politician.

Of course, even top business leaders can make big-time blunders. Just look at Steve Schwarzman, the CEO of The Blackstone Group LP (NYSE: BX). At a private investor conference, he said the following about his aborted $1.7 billion buyout of PHH Corp. (from a piece in the NY Post):

Trying to buy a mortgage bank in the midst of the subprime crisis was the equivalent of being a noodle salesman in Nagasaki when the atomic bomb went off. Not a lot of noodles left or even a person -- and that's what happened to us on this deal.

It was certainly a puzzling and unsympathetic comment.

Schwarzman seemed to think that the speech would be private. But with the pervasiveness of social media, it's assumed that anything you say will somehow windup becoming public and be used against you (here's a blog post on it, for example).

Keep in mind that Blackstone is working hard to bolster its operations in Japan. Clearly, as businesses expand into global markets, it is becoming even more important to be watchful of what we say.

Here's some additional advice when making public comments:

Don't hype your company: Over the years, I've talked to lots of small companies. While many entrepreneurs have tremendous passion (which is critical to success), this can sometimes get out of hand. Often, they will hype things or even misrepresent their performance.

But it's fairly obvious. For me, it usually means I won't write about a company. For potential customers, it probably means they won't do business with you.

Now, it's certainly OK to emphasize your strong points. This is essential. However, there is a temptation to inflate stuff. And, if you are caught, it can be just as bad as the situation with Blackstone. That is, your comments may become a feeding frenzy for bloggers.

Be mindful of the blogosphere: Unfortunately, such gaffes will usually become top-page material for anyone searching Google (NASDAQ: GOOG) for your name or your company. In such cases, it's tough to recover -- since controversial material tends to be the most popular material.

So, before speaking, think about it. Make sure your message is consistent and concise.

This sounds like basic advice. Yet, I've seen many entrepreneurs who don't practice it. And, in the end, it could be harmful for the business.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Permalink | Email this | Linking Blogs | Comments

Permalink | Email this | Linking Blogs | Comments

MAJOR PAPERS:

• According to people familiar with American International Group Inc's (NYSE: AIG) board, some directors feel that another big loss in the current quarter could prompt them to re-evaluate their support for CEO Martin Sullivan. The sources said a decision on Sullivan's fate isn't likely to be made until the company sees results over the next several months, the Wall Street Journal reported.
• The Financial Times reported that Kohlberg Kravis Roberts, The Blackstone Group LP (NYSE: BX) and Apax Partners are among the private equity groups that have been blocked from bidding int he first round of the GBP7B auction of The Royal Bank of Scotland Group Plc's (NYSE: RBS) insurance business.

• The Boeing Company (NYSE: BA) closed a helicopter production line for several hours yesterday due to possible irregularities found in two military helicopters, the Seattle Times reported. The company did not disclose exactly why it shut down the production of the H-47 Chinooks.

• According to Mac Rumors, citing French LeMatin.ch, a source in Swisscom AG (OTC: SCMWY) said Switzerland will be getting the iPhone device from Apple Inc (NASDAQ: AAPL) this summer, and it will feature GPS, Video Conferencing and Mobile TV.

Permalink | Email this | Linking Blogs | Comments

Read | Permalink | Email this | Linking Blogs | Comments

Disclosure: Horowitz & Company clients may hold positions of securities mentioned as of the publish date. Andrew Horowitz is a money manager and author of bestselling The Disciplined Investor - Essential Strategies for Success. Data provided by Briefing.com and other sources believed to be reliable. Dates may change without notice.

Permalink | Email this | Linking Blogs | Comments