Woo Hoo !!! - 'Private Equity Industry In The Crosshairs' - WaPo [View all]

[WillyT]

Private equity industry in the crosshairs
By Jia Lynn Yang, Published: January 26

Mitt Romney’s opponents have spent weeks slamming the private-equity industry where he made his fortune, saying it profits from dismantling companies and laying off workers. The industry’s trade group has pushed back. Private-equity firms are good for the country, it argues, because they make the economy run more efficiently and turn around ailing companies, creating jobs.

A class-action antitrust lawsuit against private equity’s most powerful players threatens to further damage the industry’s reputation and, perhaps by extension, Romney’s. It alleges that the firms colluded to drive down the prices paid in some of the most ambitious buyouts in corporate history.

Perhaps more significantly, it is forcing an industry known for its secrecy to hand over reams of internal documents and offer up its top executives for depositions. So far, some of the most sensitive information has been kept under seal.

The defendants include the biggest names in private equity: KKR, Blackstone, the Carlyle Group, TPG and Bain Capital, which Romney co-founded in 1984, and five others. The lawsuit covers deals inked during the industry’s most recent boom, around 2006 and 2007, several years after Romney left Bain. Many of these firms and the Private Equity Growth Capital Council ­declined to comment.

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