Tag Archives: bain

Bain Capital, Bid-Rigging Lawsuit & TN’s Frist Family

An alleged bid-rigging conspiracy among Bain Capital and other private equity firms to divvy up targeted companies — including Nashville-based HCA — may have taken as much as $1.6 billion out of HCA shareholders’ pockets by blocking rival bidders and keeping a lid on the final price when the hospital chain was sold in 2006.
So reports The Tennessean, further observing:
The legal case resonates in Nashville and across the country in part because of Republican presidential candidate Mitt Romney’s former role as the founder of Bain Capital and because of the prominence of Tommy Frist Jr. and other members of the Frist family in Middle Tennessee’s business community.
…The notion that big private equity firms such as Bain, Goldman Sachs and the Blackstone Group engaged in a conspiracy to lower sales prices in leveraged buyouts from 2003 to 2007 remains a key claim in a federal lawsuit in Boston brought against those firms by former HCA shareholders, and by stockholders of other acquired companies — such as Neiman Marcus and Toys “R” Us — snapped up in Wall Street mega-deals before the recession.
HCA — then a public company — went private in 2006 in a $32.1 billion sale to private equity funds Kohlberg Kravis Roberts (KKR), Bain Capital and Merrill Lynch, as well as to family members of HCA’s co-founder Dr. Tommy Frist Jr. and other executives on HCA’s management team.
The size of the deal was a U.S. record at the time, but the federal lawsuit in Boston lays out the legal argument that the price tag was kept artificially low. Attorneys for the private equity firms being sued insist they did nothing wrong.

Haslam’s Advice for Romney: Break Out of that Bain Box

In a Politico report from a national governor’s gathering, Gov. Bill Haslam is among Republicans quoted in giving their thoughts on what Mitt Romney should be doing differently in his campaign.
While Walker said Romney should run a singular campaign on the economy and the budget, Tennessee Gov. Bill Haslam suggested the nominee-in-waiting push back against Obama’s Bain-bashing by explaining further about what he did in the business world.
“I would hope that he’ll do more of that,” said Haslam, himself a businessman before turning to politics.
The Tennessean said Obama wanted to put Romney “in a really tight little box.”
“His job is to break out of that and show, ‘Here’s who I really am,'” Haslam said, adding: “In my mind, he’s got a heck of a story to tell.”
Other GOP governors, however, channeled the increasingly common complaint among conservatives when it comes to Romney, contending that he needed to go beyond mere criticism of Obama and detail his own plans for the presidency.

Romney’s Bain Boss Has a TN Tie

Johnson City native and Science Hill High School alumnus William Bain Jr. is the man who appointed Republican presidential frontrunner Mitt Romney as Bain Capital’s first CEO, reports the Johnson City Press.
As the Jan. 21 South Carolina primary approaches, competitors for the Republican nomination have blasted Romney for leading a group of “corporate raiders” during his 25-year tenure with Bain. Texas Gov. Rick Perry has called the company’s tactics “vulture capitalism,” and television ads now airing boast that Bain Capital is “More ruthless than Wall Street.”
Bain, who attended East Tennessee State University before transferring to Vanderbilt University, invested in two South Carolina companies that went under. One was GS Steel in Georgetown, S.C. The other was Holson Burnes in Gaffney, which lost 150 jobs when it closed in 1992.
UPDATE: Chas Sisk says he’s got some Nashville ties, too