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Try again, getting tax credits for losses, doesnt generate profits.. I have 50 + years of losses to write off, but that doesnt generate money that doesnt already exist..
OK.. let me spell it out for you...
Quote:
Casino Capitalism
Forty-to-one leverage is casino capitalism that hugely magnifies gains and losses. Bain Capital wisely chose to flip the company fast: After 18 months, it sold Accuride, converting its $2.6 million sliver of equity into a $61 million capital gain. That deal, which yielded a 1,123 percent annualized return, was critical to Bain Capital’s early success and led the firm to keep maximizing the use of leverage.
In 1992, Bain Capital bought American Pad & Paper by financing 87 percent of the purchase price. In the next three years, Ampad borrowed to make acquisitions, repay existing debt and pay Bain Capital and its investors $60 million in dividends.
As a result, the company’s debt swelled from $11 million in 1993 to $444 million by 1995. The $14 million in annual interest expense on this debt dwarfed the company’s $4.7 million operating cash flow. The proceeds of an initial public offering in July 1996 were used to pay Bain Capital $48 million for part of its stake and to reduce the company’s debt to $270 million.
From 1993 to 1999, Bain Capital charged Ampad about $18 million in various fees. By 1999, the company’s debt was back up to $400 million. Unable to pay the interest costs and drained of cash paid to Bain Capital in fees and dividends, Ampad filed for bankruptcy the following year. Senior secured lenders got less than 50 cents on the dollar, unsecured lenders received two- tenths of a cent on the dollar, and several hundred jobs were lost. Bain Capital had reaped capital gains of $107 million on its $5.1 million investment.
Bain Capital’s acquisition in 1994 of Dade International, a supplier of in-vitro diagnostic products, was 81 percent financed by debt. Of the $85 million in equity, about $27 million came from Bain with the rest coming from a group of investors that included Goldman Sachs Group Inc.
From 1995 to 1999, Bain Capital tripled Dade’s debt from about $300 million to $902 million. Some of the debt was used to pay for acquisitions of DuPont Co.’s in-vitro diagnostics division in May 1996 and Behring Diagnostics, a German medical- testing company, in 1997. But some was used to finance a repurchase of half of Bain Capital’s equity for $242 million -- more than eight times its investment -- and to pay its investors almost $100 million in fees
Now if this is OK with you, we can get Madoff back in business too...
It does not matter who gets those profits.
It is the discussion of how profits have been achieved.
Yeah, well, apparently A LOT of lefties are totally okay with how those profits have been achieved because that's how their pensions are being funded and that's how public universities are being funded.
People leverage assets EVERY SINGLE DAY.. Your car is probably leveraged, your home, even the federal government leverages to issue bonds..
There is nothing wrong, illegal, nor immoral about leveraging assets to earn more money.. Why on gods earth dont you know this?
Maddock didnt go to jail for leveraging assets, he went to jail for LYING about them..
Leveraging assets and borrowing $$ to invest back in business may lead to bright future of the company.
Leveraging assets and taking $$ out of it to pay dividends to the investors will lead to bankruptcy.
The modu operndi of Bain was to get in a company by buying majority stake.. Leverage the assets, take the $$ out hook or crook.. sometimes in names of fees, dividend, dicey acquisitions (all in the legal framework.. so no one ends up in jail) and then pushing the company to bankrupcy.
Is this the way to grow economy and create NEW JOBS? Is this not immoral or unethical?
For me, it is completely immoral and unethical...
Been there, seen it all .. I chose not to be in this type of business practice... So i DO know this and have seen it up close... Bain is nothing but a legalized MOB setup...
Now if this is OK with you, we can get Madoff back in business too...
What part of public employee union members and public universities got Bain's profits as a return on their investment in Bain's business practices do you not understand?
Along with the public employee union members and public universities that profited from Bain's success, right? They should ALL be in jail, right?
How many of Madoff's investors are in jail? So what is your fixation with the guys who gave money to Bain? This investors are the same kinda guys who invested in mortgage securities which turned out to be a big mess.. It is BAIN's policies which are unethical and are questionable..
If i were in helm of one of those institutes, i would pull out of Bain and find some good place to invest..
How many of Madoff's investors are in jail? So what is your fixation with the guys who gave money to Bain? This investors are the same kinda guys who invested in mortgage securities which turned out to be a big mess.. It is BAIN's policies which are unethical and are questionable..
If i were in helm of one of those institutes, i would pull out of Bain and find some good place to invest..
Maddoff is in jail for LYING about what he was doing.. Bain did NOT..
You keep bringing up Maddoff, as a comparison, only goes to show you dont have a dam clue what the hell you're talking about.
How many of Madoff's investors are in jail? So what is your fixation with the guys who gave money to Bain?
They were well-aware of Bain's business practices and thought so highly of them that they invested their capital in Bain. Bain's investors include public employee union pension funds and public universities.
Madoff is in jail because he lied about his assets, not because he made a profit.
You're giving the very strong impression that you have NO CLUE what you're talking about.
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