In 2007, the IUF published a A Workers' Guide to Private Equity, a 36 page A5 brochure, aimed at IUF affiliates and trade unions and their members around the world. Available in English, French, German, Spanish and Swedish, it remains an indispensable guide for trade unionists. Click here for more details and to order your copies.The October 31 collapse into bankruptcy of MF Global, the US brokerage firm with investment bank appetites and ambition, was the eighth largest corporate bankruptcy in US history, behind Lehman Brothers, Enron and Washington Mutual but ahead of automaker Chrysler. As with any bankruptcy, clients are scrambling to recover their money, but large sums have gone missing.
Continue reading "MF Global - canary in the (financial) coalmine?" »
Burton’s Biscuits, the UK’s second largest biscuit manufacturer (after private equity-owned United Biscuits), has announced it will close its factory in Moreton, Merseyside, with the loss of 342 jobs, despite commitments to the union at the site that production would continue through May 2012. Workers at the plant, represented by Unite the Union, are being squeezed by two converging financial forces: transnational food giant Kraft, for whom Burton’s manufactures Cadbury biscuits and chocolate products, and Burton’s private equity owners.
Continue reading "Kraft and Private Equity Slash and Burn at UK’s Burton’s Biscuits" »
Following 18 months of negotiations, the first-ever legislative regulation of private equity through a binding Directive was adopted by the European Parliament at the close of last year and will come into effect in 2013. What’s in it for workers?
Continue reading "EU Regulation of Private Equity: Results and Prospects" »
In a move which gives new meaning to “troubled asset recovery”, the Federal Reserve Bank of New York has gifted private equity giant Blackstone with USD 178 million. In early October, the Federal Reserve Bank of New York announced it had sold back to Blackstone USD 320 million in debt from the heavily leveraged 2007 Hilton buyout for just 142 million, booking a 56% loss. The difference between the face value of the debt – backed by Hilton properties – and the money taken in by the sale amounts to a USD 178 million public subsidy to the buyout house.
Are we witnessing a replay of the 2008 hyperinflation in the price of basic foodstuffs which pushed hundreds of millions of people already living on the margins into the ranks of the acutely hungry? In the past three months, the price of corn futures on the Chicago Board of Trade has increased by 70%
Three months before becoming the world's largest hotelier (by rooms) with the 2007 leveraged buyout of Hilton Hotels Corporation, the private equity Blackstone Group unloaded the Extended Stay chain for USD 8 billion. It was a hell of a deal for Blackstone, who picked up the chain in 2004 for just under USD 2 billion.
Continue reading "Blackstone (& Friends) Buy Extended Stay Hotels - This Time at Half Price" »
How many surprises can still be in store at Accor, the French-based hotel and prepaid services transnational? In 2009, when private equity investors Eurazeo and Colony Capital boosted their stake to 30%, it was described as a "vote of confidence" in existing management.
Continue reading "Demerging Accor - Less Than the Sum of the Parts?" »
Blackstone Chairman Stephen Schwarzman, speaking from Davos, Switzerland, has warned Australia of a foreign investment "chill" following that country's efforts to collect taxes on a windfall deal from private equity giant TPG.
Continue reading "Blackmailing the Taxman, from Davos to Sydney" »
Barring any last-minute surprises, Kraft, the world's second-largest food company, will swallow UK-based Cadbury in a deal which in its reliance on debt bears a family resemblance to...a leveraged buyout.
Private equity operator Blackstone, according to the Wall Street Journal of October 29, "has good reason to be nervous about Hilton." They're not alone; the enormous leverage taken on to finance the buyout at the height of the debt bubble now weighs heavily on the more than one hundred thousand Hilton employees around the world, on the wider financial system, and on the US Treasury, and therefore US taxpayers. Here's why.
Continue reading "Blackstone's Hilton Woes Will Weigh on Workers" »