Montana City Attempts to Regain Control of Water System From Carlyle Group

[eridani]

http://online.wsj.com/articles/public-private-deals-spark-turmoil-1410739724?mod=WSJ_hpp_MIDDLENexttoWhatsNewsThird

Three years ago, Carlyle Group CG -2.07% Carlyle Group L.P. U.S.: Nasdaq $31.27 -0.66 -2.07% Sept. 12, 2014 4:00 pm Volume (Delayed 15m) : 413,713 AFTER HOURS $31.27 0.00 % Sept. 12, 2014 6:11 pm Volume (Delayed 15m) : 27,272 P/E Ratio 13.90 Market Cap $2.09 Billion Dividend Yield 2.05% Rev. per Employee $3,705,070 09/14/14 Public-Private Deals Spark Tur... 09/12/14 Carlyle's Rubenstein: Expect C... 09/09/14 SAI Global Sale in Doubt More quote details and news » CG in Your Value Your Change Short position LP bought the pipes, pumps and water wells in Missoula, Mont., and several California communities in what the firm assumed was a relatively low-risk bet.

By most accounts, drinking-water systems nationwide need hundreds of billions of dollars in repairs and upgrades, making them ripe for private investment.

But the reality has been more complicated.

Carlyle finds itself fighting in court to retain control of the Montana water utility. Missoula officials are suing under eminent domain laws to take control, accusing one of the world's largest private-equity firms of reneging on a handshake deal to sell the system to the city. One of the California locales is considering a similar takeover for its water system.