How could Private-equity Firm Coller Capital manage Intellectual Property?

Source: New York Real Estate Journal

According to Bloomberg, Coller Capital, the private-equity firm founded by British financier Jeremy Coller, is in talks with multiple bidders to join in an offer for BlackBerry Ltd. (BBRY), a person familiar with the discussions said.

Coller will put up some financing as part of the bids, said the person, who asked not be identified because the talks are private. The firm, which buys and sells intellectual property, is seeking to acquire about 10 percent of BlackBerry’s patents if it makes a deal, the person said.

The patents of interest to Coller cover technologies ranging from push notifications to messaging, according to the person. BlackBerry’s intellectual property accounts for as much as 20 percent of the company’s total value, the person said.

BlackBerry, which announced in August that it was entertaining bids, has drawn a number of interested parties, though little in the way of concrete offers. Fairfax Financial Holdings Ltd. (FFH), BlackBerry’s largest investor, signed a tentative agreement to acquire the smartphone maker for $4.7 billion last month — without naming its buyout partners or showing that it has lined up financing. Cerberus Capital Management LP is looking at BlackBerry’s books, whileLenovo Group Ltd. (992) has also expressed interest in a BlackBerry deal, according to people familiar with the matter.

Coller, which has offices in London, New York and Hong Kong, is working with multiple parties to ensure that it’s part of a successful deal, the person with knowledge of the talks said. In addition to offering upfront financing, Coller may also share royalties from licensing the patents with the winning bidder, the person said.

BlackBerry co-founders Mike Lazaridis and Douglas Fregin, who walked away from management positions in the company in recent years, are also contemplating a bid. They said on Oct. 10 that they’re working with Goldman Sachs Group Inc. (GS) to explore the idea.

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Private-Equity Firm H.I.G. to Buy Spanish Real-Estate Assets

Private-Equity Firm H.I.G. to Buy Spanish Real-Estate Assets

MADRID—Spanish officials managing soured assets from the country’s real-estate collapse announced their first big property deal, choosing Miami-based private-equity firm H.I.G. Capital to buy a majority stake in a package of 939 homes known as Project Bull.

Officials said the property deal, one of the most closely watched in Europe this year, priced the portfolio at €100 million ($133 million).

The properties were transferred to a Bank Asset Fund, which provides a favorable tax regime to investors, officials said. H.I.G.’s Bayside Capital agreed to take a 51% stake in the fund. Spain’s “bad bank,” the government-run asset-management firm known as Sareb, will retain a 49% stake.

H.I.G. Capital beat rival bids from Lone Star Funds, Apollo Global Management LLC,APO -0.70% Colony Capital LLC and a joint offer by Centerbridge Capital Partners LP and Cerberus Capital Management LP, people familiar with the transaction said.

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Private-Equity Payout Debt Surges

Private-Equity Payout Debt Surges

Private-equity firms are adding debt to companies they own to fund payouts to themselves at a record pace, as fears mount that the window for these deals will close if interest rates rise.

So far this year, $47.4 billion of new loans and bonds have been sold by companies to pay dividends to the private-equity firms that own them, according to data provider S&P Capital IQ LCD. That is 62% more than the same period last year, which wound up being the biggest year on record, with $64.2 billion sold to fund private-equity payouts.

Buyout firms acquire companies with a combination of cash and debt, which the acquired companies aim to pay back with earnings. In dividend deals, private-equity-owned companies add more debt so they can pay dividends to their owners. Ultimately, the payouts are distributed to the buyout firms’ own investors, which include endowments, pension funds, wealthy families and the firms’ executives.

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Private-Equity Investors Take Profits on Bank Stakes

Private-Equity Investors Take Profits on Bank Stakes

A handful of private-equity investors who poured money into banks during the financial crisis are cashing out, reaping billions of dollars in profits—in some cases doubling their money—even as many small lenders continue to struggle.

Their success stands in contrast to dozens of other big investors who scooped up failed institutions but are still stuck with far less profitable holdings.

The different outcomes show that, during banking crises, the lowest price doesn’t necessarily make for the best deal. The investors who do better “are the ones who bought good franchises cheap, not distressed franchises very cheap,” said Joshua Siegel, managing principal and chief executive of StoneCastle Partners LLC, a New York firm formed in 2003 to invest in banks.

Private investors pumped billions of dollars into more than 60 financial institutions from 2008 to 2012, according to data provider Dealogic. Those figures account only for deals for which public data are available. Many bank deals during the period were private and details weren’t disclosed.

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Blackstone Group buys private equity unit

Blackstone Group buys private equity unit

NEW YORK (AP) — Private equity firm Blackstone said Monday that it has acquired a private equity unit called Strategic Partners from Swiss banking giant Credit Suisse.

Strategic Partners buys stakes in private equity funds. It has 29 investment professionals and $10 billion in assets under management. Blackstone has about 1,780 employees, according to its latest annual report. It has about $230 billion in assets under management.

Blackstone’s decision to buy Strategic Partners was first announced in April. The terms of the deal were not disclosed.

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Hedge Funds Are Sitting On $1 Trillion Of Debt

Hedge Funds Are Sitting On $1 Trillion Of Debt

America’s largest hedge funds have $1.47 trillion in net assets and more than $1 trillion in debt, according to a new report from the Securities and Exchange Commission.

The SEC issued the report — the first of its kind — to Congress last week, according to Bloomberg.

Under Dodd-Frank, legislators directed the SEC to collect information from hedge funds and private equity firms.

The new reporting rules require hedge fund managers with more than than $1.5 billion in gross assets to file quarterly with the SEC (and for each separate fund with more than $500 million, they have to further detail leverage and risk).

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Judge Dismisses Providence, Apollo From Private-Equity Collusion Suit

Judge Dismisses Providence, Apollo From Private-Equity Collusion Suit

A federal judge on Thursday dismissed a pair of private-equity firms from a long-running civil suit alleging that many of the country’s biggest buyout firms colluded to keep down the prices they paid for companies during last decade’s takeover binge.

U.S. Senior District Judge Edward F. Harrington, of Boston’s federal court, ruled thatApollo Global Management LLC APO +0.58% and Providence Equity Partners LLC could be released from the case but that there was sufficient evidence to let the case proceed against several other large firms, including Blackstone Group LP BX +1.10%, Bain Capital LLC and Carlyle Group LP CG +2.87%.

The case was brought by investors who sold their shares in the companies in question to the private-equity firms as part of several boom-era buyouts. At issue is whether the buyout firms had agreements to not compete with each other on certain deals, which could have the effect of limiting the prices paid for the companies in question.Read more

Private-Equity Buyouts Shortchange Shareholders

Private-Equity Buyouts Shortchange Shareholders

Farewell, then DELL DELL -1.08%. After a quarter century of service, the stock ticker for Dell Inc. is likely to be consigned to the dust bin of history this week. On Thursday, to be precise, shareholders are expected to seal the sale of the computer company to the private-equity firm Silver Lake Partners and founder Michael Dell.

The soon-to-be owners argue—and shareholder advisory firms agree—that this is for the best. That turning around a struggling personal computer maker simply can’t be done in the public markets. That the tyranny of quarterly earnings, fickle share prices and what-have-you-done-for-me-lately investors is too hard to endure.

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Do private equity firms owe regular income tax?

Do private equity firms owe regular income tax?

For a decade, Congress has been debating how to tax managers of private equity firms. The argument is pretty familiar to tax wonks: Should these partners treat this compensation (commonly called carried interest) as capital gains, as they do today? Or should they be taxed at the higher ordinary income rate as President Obama and others have urged?

But what if the predicate of the debate is wrong? What if the returns to private equity firms themselves, as well as their managers, are already ordinary income under current law? What if the IRS has been getting it wrong all these years to the great benefit of private equity funds and similar investment firms?

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Steinway Sold to Private Equity Firm for $438 Million

Steinway Sold to Private Equity Firm for $438 Million

The maker of Steinway & Sons pianos is hoping that a duet with private equity will be a harmonious one.

Steinway Musical Instruments announced on Monday that it had agreed to be acquired by the private equity firm Kohlberg & Company in a deal worth roughly $438 million.

The offer of $35 a share represents a 33 percent premium over Steinway’s average closing price in the 90 trading days that ended June 28. Compared with the average closing price during the 52 weeks that ended June 28, the offer represents a premium of 45 percent, the company said.

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