Performance for TPG-Axon Partners, LP:
Archive for May 2009
The Post‘s Keith Krelly reports today that our favorite Stamfordian was a no-show at last night’s fête to celebrate the 100 most influential people of the year, as determined by Time magazine. That’s probably because the big guy wasn’t invited. Which, yes, is an unforgivable dis that someone’s going to die for but the more important point lies in the other list Bubba was left off– the Time 100. That’s a problem for a couple of reasons.
1) Big boy doesn’t attend parties that aren’t being thrown in his honor.* That’s just a fact. I don’t care if it’s your birthday, bachelor, retirement, coming out party or Sweet 16– you want him there, you find a way to incorporate his presence into the proceedings and his name onto the cake.
2) (And this is actually sort of serious, not that you shouldn’t take the previous intel as gospel if you have any desire for him to give a toast congratulating your transition from Samuel to Samantha) The fact that he was left off the list is part of the grander takeaway that this little compilation was a pile of sham. Besides Stizzle, where was Chanos? Paulson (talkin’ John, not Bald)? Einhorn? (Try telling me ‘horny doesn’t deserve a spot, whether for the little dealio with Lehman or his contributions to porn. Try and fail, cockbags.) Not only did they not make the final cut, they weren’t even considered as finalists. That list, we’ll remind you, includes Charlie Gasarpino, Jim Cramer, Prince Alwaleed bin Talal and Ken Lewis. That’s a charade you couldn’t pay SC to take part in, even if you lured him there under the false pretenses that there was some ice that needed smoothing.
*Unless he’s told ahead of time there’ll be a private Jonas Brothers concert to bid on, in which case, he makes an exception.
We find ourselves wishing there was a word in English for that feeling you get when you read an article confirming the details of a bit of news- probably bad- you were already expecting. It’s that sort of sinking “Uh… wow.” that represents the sudden realization that, though you were prepared for the news, it is now more “real.” What is that word? As you know from our “Bank of America needs $34 billion” announcement yesterday, there is now at least a temporary answer: “Boaed.”
Henceforth– Boaed (“bow-uh’d“): The forced realization of the shocking magnitude of an event or occurrence that, while expected or already making rounds on the rumor circuit, only reaches the pinnacle of its emotional impact once reported through mainstream channels or experienced first-hand.
The real question, however, is how will the market receive this “news.” Given that there is no better place to find the answers to these questions than our comment section, we leave it to you. BAC closed at $10.84. Where does this take us, dear readers? Where will BAC open? More importantly, where will BAC close? $15.00? $1.50?
9:45 am Update: BAC: $11.58 +$0.74 +6.83%
Citi May Need $5B – $10B (Reuters)
The US Government has asked that Citi sit on $55B in capital reserves as a result of the stress tests, which leaves them short somewhere in the neighborhood of $10B. While their ass remains remarkably less sore than that of Bank of America, it would be comforting to know how the authorities arrived at these numbers.
“Citigroup is expected to need to raise capital as insurance against any further downturn in the economy, according to the paper.
The New York bank can easily cover any shortfall and is considering several options to close that gap, the paper cited Citigroup executives as saying.”
Judge Rejects Opposition To Chrysler Sale (FT)
“A US bankruptcy judge has rejected an attempt by dissident Chrysler creditors to derail the sale of the ailing carmaker’s viable assets to a group of new shareholders, including Italy’s Fiat.”
BofA Weighs CCB Sale (FT)
The deal could land them as much as $8B; obviously desperately needed at this point. Look at it this way ladies, Lewis is learning a fundamental lesson of life: if you can’t whore your way out of it, chances are good you’re going to have to sell your shit.
“Bank of America is considering the sale of an $8bn stake in a leading Chinese bank within days in a move that would relieve some of the pressure on its battered balance sheet.
BofA, which is undergoing a crucial US government “stress test”, is free to divest about a third of its 16.7 per cent stake in China Construction Bank on Thursday following the expiration of a lock-in period.”
GM Likely To Post Loss Tomorrow Ahead Of Bankruptcy (Bloomberg)
“The Detroit automaker may lose $11.34 a share, equal to about $6.9 billion, compared with a net loss of $5.74, or $3.3 billion, for the same quarter a year ago, according to the estimates of five analysts surveyed by Bloomberg.”
[...]
“Under GM’s latest proposal, the U.S. would control at least 50 percent of 60 billion shares in the restructured GM and a union-run health-care fund would get 39 percent. Unsecured bondholders would get 10 percent and existing shareholders would get 1 percent, GM said. After the exchange was complete, the company would do a 100-for-1 reverse split of the shares.
If 90 percent of the bondholders don’t sign up for the GM offer of 225 shares in the new automaker for each $1,000 in principal they hold by May 26, GM plans to file bankruptcy, Henderson said after unveiling the offer.”
Flowers Sees Opportunity In Struggling Banks (NYT)
Long story short: Flowers is seeking to invest in US banks, but the authorities don’t want PE firms holding majority interest, just minority. The United States thinks PE firms are too risky to hold banks outright, that by allowing them to do so would set the state for the next financial crisis.
REITs Seize Opportunity To Deleverage (WSJ)
“In the past six months, 16 large REITs have repurchased a cumulative $3.9 billion in face value of bonds at a discounted outlay of $2.5 billion. Among the biggest offerings was ProLogis, a warehouse developer, which used $414 million since October to buy bonds with a face value of $641 million.”
Regulators have told Bank of America that the company needs to raise roughly $35 billion in capital based on results of the government’s stress tests, according to people familiar with the situation.
The exact amount of the needed infusion couldn’t be determined late Tuesday, and Bank of America officials either declined to comment or couldn’t be reached.
$$$ U.S. to Set Condition for Banks Repaying TARP [WSJ]
$$$ Bankruptcy Sleuths Find Cash in Trader Receipts for Lap Dancers [Bloomberg]
$$$ U.K. Rich Threaten to Leave Because of Taxes [Wealth Report]
United States Treasury
cc: United States Taxpayers
cc: Treasury of Canada
To whom it may concern:
I am Chiedu Boglo the son of a retired General in the American Army and a former minister. I came to know of you in my search for a reliable person to handle a very confidential transaction, which involves the recovery of a business producing huge sums of money. There were series of contracts executed by a Consortium of Workers, Suppliers and Dealers for the company in which my father was minister in our country. The original values of these labor contracts were deliberately over-invoiced to the tune of nineteen billion United States Dollars (US$19,000,000,000.00). The over-invoiced sum purposed to acquire after retirement. Unfortunately, things took another turn.I will explain more to you when you show your interest to assist me. Consequently, I am looking for someone who will help us ( my father and I) to receive the money on our behalf. Needless to say, the trust reposed on you at this juncture is enormous. In return, we have agreed to offer you 8% of the total equity in the rescued company. While we shall take 92%.
You must however NOTE that this transaction is subject to the following terms and conditions; (i) Our conviction of your transparent honesty. (ii) That you wound treat this transaction with utmost secrecy and confidentiality. (iii) That you provide working capital loan in the amount of eight billion United States Dollars (US$8,000,000,000.00) at zero interest rates and the funds would be transferred to an account over which you have absolute control. Modalities have been worked out at the highest levels to make for the immediate transfer of the funds within 10 working days, subject to your satisfaction of the above stated terms. Our assurance is that your role is 100% risk-free. To accord this transaction the legality it deserves and for mutual security of the funds, the whole approval procedures will be officially and legally processed with your name or the name of your company you may nominate as the bonafide beneficiary. Kindly, respond to this mail with a view to my giving you more information. Please, do send your acceptance via my E-mail address. Also, include in your mail you private/confidential telephone and fax number to enable me reach you as soon as I get your response. Thank you very much as I anticipate your response.
Yours faithfully,
Chiedu Boglo
Chrysler won’t repay bailout money [CNNMoney]
Per CNBC’s Rebecca Jarvis, who also reports that Thomas Lauria, a lawyer for the group, told U.S. Bankruptcy Judge Arthur Gonzalez that “people in chat rooms” were saying threatening things in the general direction of his clients (who also “felt” their reputations were threatened by the White House, though Lauria “did not specifically say” that threats were made by the administration, only that Obama’s words during his press conference last week were a matter of concern). Oh, and he’d like to see lenders get 50 cents on the dollar.
Also, “don’t open your mouth and say dumb things.” Surely these allegations have nothing to do with the suggestion that Santelli doesn’t “understand how the banking system works.” [via mediabistro]
“SEC Charges Operators Of Reserve Primary Fund With Fraud”
The situation is fluid. Updates to come. Watch this space.
2:22 pm Update: CNBC notes that The Reserve Primary Fund, whose buck-breaking record Dealbreaker reported on back in October, has some explaining to do.
2:51 pm Update:
The Securities and Exchange Commission today filed fraud charges against several entities and individuals who operate the Reserve Primary Fund for failing to provide key material facts to investors and trustees about the fund’s vulnerability as Lehman Brothers Holdings, Inc. sought bankruptcy protection.
SEC Charges Operators of Reserve Primary Fund With Fraud [SEC.gov]
Performance for Greenlight Capital LP:
