Top Story
The Deal Professor’s Year-End Review
![[The Deal Professor by Steven M. Davidoff]](https://webarchive.library.unt.edu/eot2008/20090101001600im_/http://graphics8.nytimes.com/images/blogs/dealbook/deal_professor75x75.gif)
It was a terrible year.
The entire global financial system almost collapsed, the takeover market shrank by a third as the credit markets dried up, the stock market had one of its worst years in history, and a series of legendary financial institutions disappeared. To top it off, Bernie Madoff (and whomever else it is eventually found that he enlisted and colluded with) reportedly swindled investors out of more than $50 billion, including Elie Weisel’s foundation. Elie Weisel. Who does that? And given the allegations, how can Mr. Madoff still be free on bail in a multimillion-dollar penthouse? It’s a bitter end to a bad year.
But for deal lawyers and deal-makers, it was a year of learning. MORE »
Latest Dealbook Headlines
Mergers & Acquisitions
Why Dow-Rohm Is No Huntsman-Hexion
The markets are full of speculation this week about the fate of Dow Chemical’s $15 billion deal to buy Rohm and Haas.
I’m going to go out on a limb and assert that the Dow-Rohm deal is not going to be a Huntsman-Hexion redux.
In the Huntsman saga, Hexion (along with its private-equity backer, Apollo Management) was able to leverage ambiguity in its acquisition agreement to attempt to litigate its way out of its deal to acquire Huntsman, another chemical company. Ultimately, Hexion lost that battle but won the war, obtaining the termination of the acquisition for a price of less than a billion dollars. MORE »
Investment Banking
Credit Suisse Swaps Assets for Aberdeen Stake
Credit Suisse Group said it would sell parts of its asset-management business to Aberdeen Asset Management, a British firm, in exchange for a 24.9 percent stake in Aberdeen that it valued at 381 million Swiss francs ($360 million).
The move will see Switzerland’s second-largest bank transfer some 75 billion Swiss francs ($70.93 billion) in managed assets to Aberdeen, The Associated Press reported.
“This agreement enables us to focus our resources on our alternative investments, asset allocation, and Swiss businesses, where we have strong performance and critical mass, and which better align with our integrated banking model,” Rob Shafir, the chief executive of Credit Suisse’s asset management division, said in a statement Wednesday announcing the deal. MORE »
I.P.O./Offerings
Postcards from I.P.O. Purgatory
Many stories have been written about the huge number of initial public offerings that got pulled in the second half of 2008. The markets were cruelly volatile and investors were stuffing money under their mattresses, making the prospect of selling new shares highly unattractive.
But going into 2009, there are dozens of stock sales stuck in a kind of I.P.O. limbo, not having been withdrawn but also unlikely to proceed until global markets stop convulsing.
A week before the end of 2008, there were 124 United States companies with initial offerings in the “pipeline,” valued at a combined $25.7 billion, according to Thomson Reuters. MORE »
Hedge Funds
John Paulson Criticizes Funds for Blocking Exits
Kenneth Griffin’s Citadel Investment Group did it. So did Wesley R. Edens’ Fortress Investment Group.
But John Paulson, the head of another big-name hedge fund firm, is apparently quite critical of the increasingly common practice of halting redemptions, or temporarily blocking hedge-fund investors from withdrawing their money.
In a 2009 outlook to investors obtained by Bloomberg News, Mr. Paulson (pictured above) took issue with fund managers who block the exits for their investors, even in tough times. MORE »
Venture Capital
Bjork, Venture Capitalist?
From Claire Cain Miller at Bits:
Bjork - the pixie-faced Icelandic singer famous for her eclectic music, provocative music videos and outlandish fashion sense (even if you don’t know her music, you likely know her swan dress at the 2001 Oscars) - is adding “venture capitalist” to her resume.
Audur Capital, a venture capital firm in Reykjavik, Iceland, has started its second fund, named Bjork, with 100 million Icelandic kronur (about $816,330) from Bjork and the firm. They are raising more money now, with the goal of closing the fund in March. MORE »
Legal
Madoff Spotlight Turns to Role of Offshore Funds
The investigations into Bernard L. Madoff are expanding into offshore tax havens.
Federal prosecutors are beginning to consider what role offshore fund operations may have played in the $50 billion Ponzi scheme that Mr. Madoff is accused of orchestrating, The New York Times’s Lynnley Browning reports.
Of particular interest is whether Mr. Madoff and some of his investors used funds based in offshore tax havens to evade American taxes, a person briefed on the investigation told The Times. MORE »
Private Equity
Could a Big Buyout Firm Go Bust?
In the last year, storied investment banks have fallen and some major hedge funds have closed. Now, Michael Wolff of Vanity Fair is wondering if (or when) a big flame-out will hit the private equity world.
Several private-equity-backed companies have already gone bankrupt in the recent downturn — Linens ‘N Things, backed by Apollo Management, is just one example — and more are likely to do so. In addition, shares of publicly traded private equity firms such as Blackstone Group and Fortress Investment Group have been hit hard.
But Mr. Wolff is asking whether a marquee private equity firm itself could collapse, and, he writes, “in the domino pattern of this financial crisis, take the other firms with it?” MORE »
DealBook's Holiday Hiatus
Our Web site will be in holiday mode through Jan. 4, with limited updates and no daily e-mail newsletter. A big thanks to all of our readers for your support and feedback in 2008. See you next year.
The pyramid of repossession blame
December 24, 2008
Flight to simplicity likely in 2009 bond market
December 24, 2008
TPG's investor concessions will pressure other LBO shops
December 23, 2008
The Bernard Madoff Scandal
DealBook's full coverage of the Madoff scandal, perhaps the largest securities fraud case in history, with potential losses reaching $50 billion. More»
A Bonus Season Like No Other
Wall Street is wrestling with the issue of year-end payouts amid a growing outcry about compensation. More»
Can the S.E.C. Bounce Back?
The market regulator's next chair faces the task of restoring its dented reputation. More»
The Madoff Game
Try your hand at running a multibillion-dollar Ponzi scheme with Breakingviews' handy spreadsheet. More»
Tracking the Bailout
The New York Times tracks how the $700 billion Troubled Asset Relief Program is being doled out to banks, insurance companies and more. More»
Introducing the DealBook Widget
Get continuously updated headlines from DealBook, built into your blog, social network or search engine home page. More»
Revolving Door
The latest hires, promotions and departures at K.K.R., Lazard, Barclays and more. More»
The Deal Professor
A blog-within-a-blog that looks at mergers, private equity and corporate governance through a legal lens, written by Steven M. Davidoff, a professor at the University of Connecticut School of Law and a former lawyer at Shearman & Sterling. More»
The Rescue Squad
DealBook's special section looks at the people reshaping Wall Street and what the new landscape might look like. More»
The Bear Bailout
Full coverage of the proposed takeover of the troubled investment bank -- and the crisis that led to the sale. More»
DealBook for BlackBerry
Get one-click access to DealBook to read the latest deal news throughout the day. Visit mobile.nytimes.com/bbinstall directly from your BlackBerry or by sending the text message "db install" to 698698.
More information on DealBook for BlackBerry.
Madoff scandal hits near-farcical note
December 31, 2008,
Venture capital shakeout will leave few winners
December 31, 2008,
Greater Depression could last 20 years
December 31, 2008,
Live From Tulane
Coverage from the Corporate Law Institute, where the mergers and acquisitions crowd have gathered to talk shop. More»
Davos Diary 2008
Reporters and columnists for The Times and The International Herald Tribune blog from the World Economic Forum in Davos, Switzerland. More»
Special Section: Leveraged Planet
DealBook's third special section looks at the growing ties between Wall Street and the global markets from Europe and Asia in an increasingly unsettled environment for finance. More»
Go to the Special Section»
Special Section:
After the Party
What's next now that the buyout boom has gone bust, why Wall Street is playing both sides with its political donations and how young deal-makers are linked by their colleges. More»
Masters of the New Universe
In DealBook's special section of The New York Times, a guide to the deal ecosystem, a report on what lies behind the buyout boom, a profile of the hedge fund that may be the next Goldman Sachs, and more. More»
Markets
Dealbook News By Industry
DEALBOOK JOB SEARCH
nytimes.com and monster.com
Find the best jobs in the New York City metro area and beyond.
Job Categories
DealBook: The Tuesday Column
Andrew Ross Sorkin's commentary on deals and the deal makers behind them.
About DealBook
DealBook is a financial news service produced by The New York Times. It is published daily, Monday-Friday, except on U.S. Market holidays and during the last week of the year. A daily digest of DealBook is also available via email, delivered before the market opens. DealBook editorial staff: Andrew Ross Sorkin, Peter Edmonston, Liza Klaussmann, Michael J. de la Merced, and Keith Leighty. Illustrations by Chris Gash.
Syndication
Top Movers chart above: Copyright © 2006 MarketWatch, Inc. All rights reserved. Please see our Terms of Use. MarketWatch, the MarketWatch logo, and BigCharts are registered trademarks of MarketWatch, Inc. Intraday data provided by ComStock, an Interactive Data Company and subject to the Terms of Use. Intraday data is at least 20-minutes delayed. All times are ET. Historical and current end-of-day data is provided by FT Interactive Data. Earnings data provided by WallStreetHorizon.com.
