Return of the King
Did you think this recent wave of deal making had it all? Well, everything but a cameo from the junk bond king.
Michael Milken, who has kept a low-profile the past few years, is looking to complete a private placement in his educational company Knowledge Universe:
March 20 (Bloomberg)—Michael Milken, the former junk bond chief from Drexel Burnham Lambert Inc. who served prison time for securities fraud, is back raising money. This time, for himself.
Milken plans to sell a $1 billion stake in his group of educational companies called Knowledge Universe. Goldman Sachs Group Inc. and Credit Suisse Group are helping find investors for the private sale, according to U.S. regulatory filings.
For the past decade, Milken has run his own research institute and focused on philanthropy. He also has funded Knowledge Universe with his money and that of close associates including Oracle Corp. Chief Executive Officer Larry Ellison. He has commitments for ``more than'' half the offering, said Milken spokesman Geoffrey Moore in a March 14 statement. Investor sentiment has waxed and waned in the education space the past few years but valuations have firmed up since Goldman Sachs and SAC Capital, among others, were involved in deals to buy Education Management and Laureate Education, respectively.Clearwire Prices
Need to gorge on more paper?
The Clearwire (CLWR-NASDAQ)) IPO priced tonight for tomorrow...they up-sized the deal and priced at the high end of the range:
Have at it...perhaps it can re-ignite this tape.
$25 American dollars
Craig McCaw must really need the money. Intel, Motorola and Bell Canada will retain sizable interests in the company.
But McCaw seems soooo....’80’s?
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The content contained in this blog represents the opinions of 1440 Wall Street. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author. Underthecounter has no position in securities mentioned above.
Got Lunch?
Working on Wall Street has its advantages...particularly for buy siders who know how to work over their sell side counterparts for a meal in the name of research.
Smith & Wollensky has long been Wall Street’s midtown cafeteria...and it appears that Alan Stillman will retain control of his venerable NYC operations after the sale…
NEW YORK (AP)—Steakhouse chain operator Smith & Wollensky Restaurant Group (SWRG-NASDAQ) Inc. on Monday said it has agreed to be acquired by Patina Restaurant Group LLC for about $79.6 million in cash, or $9.25 per share.The sale price represents a 12.8 percent premium over Smith & Wollensky’s Friday closing price of $8.20 on the Nasdaq Stock Market. The company has about 8.6 million shares outstanding.Smith & Wollensky’s board of directors approved the agreement and is recommending that its stockholders do the same. The deal is expected to close during the second quarter.As part of the transaction, Alan N. Stillman, Smith & Wollensky’s chief executive, will acquire from Patina the restaurants currently operated in New York and other assets, and will assume specified liabilities, according to a company release.Patina’s New York properties include the Ice Rink and Sea Grill in Rockefeller Center, and Nick & Stef’s Steakhouse at Madison Square Garden. AP
Do the Math
The stories circulating over the Fortress Investment Group (FIG-NYSE) IPO remind us of the furor over the Netscape IPO. It would seem everyone on Wall Street is watching this deal all along their Watchtowers.
In July of 1995 I placed a courtesy call to the underwriters of the Netscape deal to snag a seat at the lunch as the circus made its way through New York City...dealing with the gatekeepers that control the velvet rope at these rubber chicken gatherings can be frustrating.
The roadshow was booked solid and I was told I could not attend..and this was two weeks ahead of pricing. Incredulous, I thanked Morgan Stanley for the love and hung up the phone. Of course, I deftly skirted the muscle at the roadshow door and stole someone’s precious seat at a table.
While the food was less than memorable, the deal put the internet on Wall Street’s map.
And the stock ripped:
On 14 November 1995 the Mountain View producer of Internet software announced a 2 for 1 stock split just 97 days after going public. That ranks among the fastest few dozen stock splits ever. Netscape’s management wasn’t just showboating: The stock was ripe for a split. It has soared spectacularly since its initial public offering at $28 per share on August 9, and last week it broke through $100. It closed at 96 ½. The split will cut the price by half, but shareholders will get an additional share for every one they hold, so the total value won’t change. Its stock trading was 242% premium to its initial public offering price. NeoMinds
Today’s stories of packed meetings are cute....but this time it is different. At least with the motivations of the managers hanging from the rafters.
Sure, some of those in attendance were looking for an allocation on the deal...they might even tuck it away in the hope it is the next new, new thing.
And others go to roadshows looking for a free lunch...it is one of the few the Street will ever provide.
But most of the managers in attendance were just comping the deal against their own business...in an effort to place a valuation on their own firm. Then they look at their stake and guesstimate their net worth...then they go to Bobby Van’s or other watering holes and chew it over.
We will take a rain check on Fortress...to us it is just another Castle Made of Sand.
But we do love America...Is this a great country or what?
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The content contained represents the opinions of 1440 Wall Street. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author. No position in the securities mentioned
