Inside the Clear Channel Trial: What is Unique?

[UPDATE: The two private equity firms and the six banks have reached an agreement over the financing of the Clear Channel Communications buyout. The new deal lowers the price to $36 per share, from $39.20 per share. In the annals...

May 13 2008

No More Static: Sirius and XM Complete Merger

Our cousins at Wired.com report on the Sirius-XM merger:Well, it's official: Sirius and XM satellite radio have finally tied the knot, ending speculation by creating a single entity known as Sirius XM Radio, Inc. that represents all of the country's...

Jul 29 2008

Private Equity: Breaking Up Is Not That Hard to Do

Not too long ago, private equity was Mr. Right in corporate match-making. Offering rich premiums and wooing management, private equity firms were often welcome suitors. Thanks to the credit crunch, however, private equity firms may become known as love 'em...

Dec 27 2007

Clear Channel Court Clash: Crowds, Emails, and a House

With a $22 billion in financing at stake, a hearing over the disputed buyout of radio giant Clear Channel Communications drew a packed audience in lower Manhattan today. Runners for hedge fund managers and law firms showed up early at...

Apr 24 2008

From Frying Pan to Fire, Stockbroker Edition

The WSJ today reprises the New York Post's story from earlier this month about a culture clash between Merrill Lynch and Bank of America. For all the clashing, though, we're told that 90% of the brokers who BofA wanted...

Nov 14 2008

Citi Tidies Up a Recent Acquisition

It can be awkward to sell potential clients on a new back-office accounting and financial record-keeping service when the enterprise is under investigation for not meeting standards in its own financial reporting, recordkeeping, and internal controls. Citigroup faced that problem...

May 23 2007

The Crazy, Upside Down World of Credit Swaps

Why did credit default swaps on Morgan Stanley and Goldman Sachs rise today? The cost to insure Morgan Stanley's debt rose by 50 basis points to 480 while Goldman's cost rose by 40 basis points to 240. A Clusterstock headline...

Oct 15 2008

Entertainment Tonight for Corporate Lawyers

Delaware has many charms. But for corporate lawyers, the place holds a special attraction: The Delaware Court of Chancery! It's name may conjure a Dickinsean world of musty cases, but since the merger craze began in the 1980s, the court...

Dec 21 2007

Masters of the Universe, Ranked

Private Equity International released its annual ranking of the 50 top firms, according to capital raised over the last five years. And those sums grew dramatically in the last 12 months. No. 1 Carlyle Group, for example, topped the 2007...

Apr 29 2008

Hell Hath No Fury Like a Bank Scorned

We were engaged, damn it! That's the essential line that Citigroup's lawyers --- in all likelihood from the New York powerhouse firm of Shearman & Sterling --- will be arguing when they file a lawsuit challenging the deal that Wachovia...

Oct 03 2008

Wall Street's New Realities

My anonymous colleagues here at Portfolio.com have a couple of questions: With Bank of America's $44 billion acquisition of Merrill Lynch, only two independent Wall Street firms remain: Goldman Sachs and Morgan Stanley. Will they now feel pressure to...

Sep 15 2008

Boom Times for Analyst Bonuses?

Spring might be arriving late in New York, but Bonus Rumor Season has started early for investment banking analysts. Compensation numbers are already circulating through bullpens up and down The Street, and so far best guesses have the top first years finally breaking the six-digit barrier. And that's just the ...

Apr 18 2007

Banks Stuck With Unwanted Chrysler Debt

Suddenly, underwriting billions of dollars in junk-rated debt looks less like a profit center and much more like a very bad idea.

Jul 25 2007

When "Best" Isn't Good Enough, Call a Lawyer

"I'll do my best." We've all heard that line at one time or another. In the high-stakes world of mergers and acquisitions, the corporate lawyers who draft the contracts that seal these deals are fond of a clause that requires...

Feb 01 2008

Goldman Sachs, The Best of the Worst

A lot of people are eager to bid good riddance to 2008, but perhaps no group looks more forward to a fresh start in 2009 than dealmakers. The global market for mergers and acquisitions took a beating in 2008, but...

Dec 23 2008

Who Will Take Over Citi?

As John Carney notes today, Citigroup's market capitalization is $21 billion; that of Goldman Sachs is $20 billion. Can anyone say "merger of equals"? Nothing's unthinkable in this market, not even the idea that you can tie two rocks...

Nov 21 2008

Mark-to-Model on Wall Street: The Numbers

Nouriel Roubini hoists a nice piece of detective work from his comments: Bernard has gone down the list of Wall Street banks, looking at how much they have in the way of level 3 ("mark to model") assets, compared...

Nov 06 2007

Idle Chatter: Clear Channel, 'NYT,' CAA, more

-U.S. ad spending grew 0.2 percent last year. And we weren't even in a recession yet! [TNS] -Clear Channel and its private equity buyers might have to go to court to force the banks financing the sale to hold up their end of the bargain. [NYT] -New York Times Co. ...

Mar 26 2008

Bank Megamerger of the Day

While Wall Street has been utterly transformed by this financial crisis, US Main Street banking has not been. Yes, your local Fleet branch is now part of the same empire that owns Merrill Lynch, but it turned itself into...

Sep 18 2008

Whatever Happened to Citicorp?

Dana Cimilluca notes that shares in Citigroup, today, are below the level at which shares in Citicorp were trading before it merged with Travelers. Now, that's not necessarily a fair comparison: Citigroup, today, has a market capitalization of $135...

Jan 15 2008

Stocks: Recession Bites

For some reason, I started paying more attention than usual to the stock market today. The closing prices are sobering: Sears Holdings and Goldman Sachs, down 10% to new lows. Google below $300. Citigroup below $10. Morgan Stanley down...

Nov 12 2008

Blame Citigroup's woes on the Citi-Travelers Merger

Justin Fox -- rightly, I think -- reckons that the repeal of Glass-Steagal was on net a good thing, not a bad thing, for the US banking system, if only because it has allowed big commercial banks like Bank...

Dec 02 2008

Where Private Equity Meets Public Debt

Back in October, things were so much smaller. The idea then was that KKR would put up $2 billion of equity, leverage it up to a total of $10 billion by borrowing $8 billion from Citigroup, and then use...

Apr 08 2008

Another Buyout Bust

Kohlberg, Kravis, Roberts appears close to winning the dubious honor of filing the biggest private equity-backed bankruptcy since the credit crisis started. Masonite International, the Canadian door maker bought by KKR in 2005 for $1.9 billion, missed a $42 million...

Oct 21 2008

Pay Bankers Much Less

Andrew Ross Sorkin is worried about what happens if you don't pay bankers enough money: The trick, of course, is to dole out enough rewards to keep executives working, and working hard, but not to dole out too much......

Dec 02 2008

Parsing Bank of America: Crisis Is Our Friend

Just prepare for seven years, and then press the button.

Sep 15 2008

Who's Courting Sallie Mae?

Government owned, then publicly traded ... and now privately held? Shares in Sallie Mae have made their largest leap in 22 years, and all before breakfast. After jumping in European markets, the stock soared by 15 percent, or $6.01, to...

Apr 13 2007

Wall Street Huddles for Safety

Small banks, it seems, have precious few friends these days; even the big banks worry about surviving alone, and so they're pooling their resources. $7 billion each, to be precise, from Bank of America, Barclays, Citigroup, Credit Suisse, Deutsche...

Sep 15 2008

Demonic Short Sellers

Jim Surowiecki says, quite rightly, that short selling can cause viciously self-fulfilling downward spirals, especially in financial stocks. But reading the WSJ's long and alarmist tale of what happened to Morgan Stanley in September, I'm more convinced than ever...

Nov 25 2008

Did the End of the Investment Banks Cause the Latest Sell-Off?

Robert Peston thinks that much of the recent sell-off can be attributed to the decision by Goldman Sachs and Morgan Stanley to convert into banks: It was caused, to a large extent, by an exceptional and unprecedented shrinkage in...

Oct 27 2008