Gfy!
When Romney ran Bain Capital, his word was not his bond
, there is another version of the Bain way that I experienced personally during my 17 years as a deal-adviser on Wall Street: Seemingly alone among private-equity firms, Romney’s Bain Capital was a master at bait-and-switching Wall Street bankers to get its hands on the companies that provided the raw material for its financial alchemy. Other private-equity firms I worked with extensively over the years — Forstmann Little, KKR, TPG and the Carlyle Group, among them — never dared attempt the audacious strategy that Bain partners employed with great alacrity and little shame. Call it the real Bain way.
Here’s how it worked. Private-equity firms are always eager to find companies to buy, allowing them to invest chunks of the billions of dollars entrusted to them and from which they earn hundreds of millions in fees. One ready source of these businesses is Wall Street bankers hired to sell companies through private auctions. The good news is that when a banker puts together a detailed selling memorandum about a company, chances are very high that company will be sold; the bad news is that these private auctions tend to be very compe ive, and the winning bidder, by definition, is most often the one willing to pay the most. By paying the highest price, you win the company, but you also may reduce the returns you can generate for your investors.
I never negotiated directly with Romney; he was too high-level for any interaction with me. Rather, I dealt often with other Bain senior partners, who were very much in his mold. In my experience, Bain Capital did all that it could to game the system by consistently offering the highest prices during the early rounds of bidding — only to try to low-ball the price after it had weeded out compe ors.
By bidding high early, Bain would win a coveted spot in the later rounds of the auction, when greater information about the company for sale is shared and the number of compe ors is reduced. (A banker and his client generally allow only the potential buyers with the highest bids into the later rounds; after all, you can’t have an endless procession of Savile Row-suited businessmen traipsing through a manufacturing plant if you want to keep a possible sale under wraps.)
For buyers, the goal in these auctions is to be one of the few selected to inspect the company’s facilities and books on-site, in order to make a final and supposedly binding bid. Generally, the prospective buyer with the highest bid after the on-site due-diligence visit is selected by the client — in consultation with his or her banker — to negotiate a final agreement to buy the company.
This is the moment when Bain Capital would become especially crafty. In my experience — which I heard echoed often by my colleagues around Wall Street — Bain would seek to be the highest bidder at the end of the formal process in order to be the firm selected to negotiate alone with the seller, putting itself in the exclusive, compe ion-free zone. Then, when all other compe ors had been essentially vanquished and the purchase contract was under negotiation, Bain would suddenly begin finding all sorts of warts, bruises and faults with the company being sold. Soon enough, that near-final Bain bid — the one that got the firm into its exclusive negotiating position — would begin to fall, often significantly.
Of course, some haggling over price is typical in any sale, and not everything represented by sellers and their bankers is found to be accurate under close examination. But Bain Capital took the art of negotiation over price into the scientific realm. Once the compe ive dynamics had shifted definitively in its favor, the firm’s genuine views about what it was willing to pay — often far lower than first indicated — would be revealed.
At such a late date, of course, the seller is more than a little pregnant with the buyer. Attempting to pivot and find a new buyer — which knew it had not been selected in the first place, but was now being called back — would be devastating to the carefully constructed process designed to generate the highest price. Once Bain’s real thoughts about the price were revealed, the seller either had to suck it up and accept the lower price, or negotiate with a new buyer, but with far less leverage.
Needless to say, this does not make for a very happy client (or a happy banker). By the end of my days on Wall Street in 2004, I found the real Bain way so counterproductive that I no longer included Bain Capital on my buyer’s lists of private-equity firms for a company I was selling.
The real Bain way may be nothing more than a clever tactic to eliminate compe ion from a heated auction in order to buy a business at an attractive price. After all, Bain Capital is seeking the highest returns for its investors. But Bain’s behavior also reveals something about the values it brings to bear in a process that requires honor and character to work properly. If a firm’s word is not worth the paper it is printed on, then its reputation for bad behavior will impair its ability to function in an honorable and productive way.
I don’t know if Bain Capital still uses the bait-and-switch technique when it competes in auctions these days (I’m told that it doesn’t). But that was the way the firm’s partners competed when Romney ran the place. This win-at-any-cost approach makes me wonder how a President Romney would negotiate with Congress, or with China, or with anyone else — and what a promise, pledge or endorsement from him would actually mean.
Would a President Romney, along with a Republican Congress, cut taxes for the wealthy even more than he has pledged to do? Would he not try to balance the federal budget, even though he has said he would? Would he protect defense spending, as he has indicated he would?
I have no idea how Romney might behave in office. I do believe, however, that when he was running Bain Capital, his word was not his bond.
http://www.washingtonpost.com/opinio...xwP_print.html
=========
More evidence that Willard Gecko is true, predatory 1% s bag, will do and say anything to get screw the other guy.
.........
Last edited by boutons_deux; 01-15-2012 at 04:51 PM.
double tap
On MLK Day, Romney Campaigning With Anti-Immigrant Official Tied To Hate Groups
On a day set aside to honor civil rights activist Martin Luther King, Jr., Mitt Romney plans to tout his extreme immigration positions during a campaign stop in South Carolina today — with Kris Kobach, the author of Arizona’s and Alabama’s immigration laws, at his side. He will attack his compe ors Newt Gingrich and Rick Perry for their softer immigration stances, which could resonate with South Carolina voters who support that state’s harmful immigration law.
“Mitt Romney stands apart from the others. He’s the only one who’s taken a strong across-the-board position on immigration,” Kobach said, and he told Fox News’ Neil Cavuto that Romney was much farther to the right on illegal immigration than his fellow presidential candidates.
Before he became Kansas’ secretary of state, Kobach worked for Immigration Reform Law Ins ute, the legal branch of Federation for American Immigration Reform (FAIR), which the Southern Poverty Law Center has labeled as a “nativist hate group.” One of FAIR’s main goals is to overturn the Immigration and Nationality Act of 1965, which “ended a decades-long, racist quota system that limited immigration mostly to northern Europeans.” FAIR’s founder John Tanton has said that he wants the U.S. to remain a majority-white nation through limiting the number of non-whites who enter the U.S.
http://thinkprogress.org/justice/201...ther-king-day/
His stance on immigration is a legitimate concern in the general election. A couple of the other surprising stances brought up last night that might give him trouble...detaining Americans indefinitely and not allowing reformed violent criminals to ever vote again.
Those are strangely hardline for a supposed moderate.
Not for a candidate without any well-defined core.
Romney is only pretending to be hardline now, but if he is elected President and still feels the need to project "tuffness," there will be nothing pretentious about it.
I think the "tuff" schtick is real.
doesn't seem to be working at the moment:
Willard Gecko is pampered, born-wealthy wimp. shtick is theatre, TV candy, it ain't real.
His Bain was also a liar, bidding high for company, scaring off other buyers, then reducing his bid, screwing the company down to a lower selling price. iow, his word on his bid was worthless.
I must admit I didn't see Romney screwing up a sure thing.
only a link?
Newts campaign reminds me of a B17 bomber flying through flak over Berlin...they just keep shooting chunks off of him but he still miraculously hasn't crashed.
too hard to click?
Heard some very sound logic that the states after Florida play very much into the hands of Romney. So if he beats Gingrich in Florida or keeps it close he should lock up the nomination by building momentum over the next six weeks or so. Also playing against Gingrich...there's exactly one debate in the month of February.
not being on the ballot in VA and MO has got to hurt
Too hard to post contents?
Tonight's debate should be interesting.
the link is relevant. ignore it if you wish.
Maybe. Romney will be Romney so nothing to see there. Same for Paul and Santorum. The only thing interesting will be to see how skillfully Newt tries to work in attacking the media for asking him questions. With his poll numbers plummeting he should be pretty desperate to try for another "victim of the liberal media" bounce.
I'm not a Romney supporter, but I thought this was his best debate so far. He received the majority of loud approval from the audience, and he neutralized Newt on several occasions, even calling ole Newt out on his state by state promises. The only weak point Romney had was with Santorum over Obamacare/Romneycare. He tried to recover, but Santorum made him look like a fool.
Done deal
Right or wrong Romney will be the guy.
The rest can pack their bags and go home. Santorum will concede after Florida. Newts ego will keep him in but he's toast.
I'd just like to see Ron Paul secure a nice chuck of his own delegates.
There are currently 1 users browsing this thread. (0 members and 1 guests)
Posting Permissions
Reply With Quote
