Comments for A Private Equity Blog

Comment on How to get the best price when selling a business by petelehrman

petelehrman — Fri, 19 Mar 2010 08:45:03 +0000

These are all very good points. Since the post focuses on high-level strategy for entrepreneurs, let me be a bit of a self-promoter and share a blog that we just wrote titled "6 Keys To Writing Great Investment Teasers".

It's intended to help entrepreneurs as well as the M&A professionals who represent them, and is based upon the research we've conducted on teasers that are submitted to our private marketplace. Hope you like: http://bit.ly/aiXdac

Comment on What happens to EV when you issue more equity? by The Private Equiteer

The Private Equiteer — Mon, 15 Mar 2010 07:03:44 +0000

Hey Bharat, thanks for the note.

There are two different methodologies here, which we shouldn't mix up. EV (as a multiple of earnings for M&A purposes) and DCF. In theory, they should lead to the same value. But in practice, they rarely do. Not because either is technically wrong, but because one is focused on price and the other on value. EV estimates what someone WOULD pay and DCF estimates what someone SHOULD pay.

It's just like the stock markets. You can create the most advanced and technically correct valuation methodology, but if the market uses PE ratios to make their investment decisions, your methodology will never be accurate in practice (unless of course it accounts for behavioural factors).

So, technically, you're right. Cash has a cost and should be valued accordingly. But in the case of EV, we're talking about what a business is worth today if sold. In the assumed transaction, the cash would either offset the sale price or be paid out. So it doesn't spend any time accruing interest in the assumptions made for EV.

Hopefully that makes sense.

Comment on What happens to EV when you issue more equity? by Bharat

Bharat — Sat, 13 Mar 2010 17:55:04 +0000

Hi,

Need a clarification. You said that equity issued purely to pile up cash will have no implicition on EV. Assuming that we use Discounted cash flow to calculate EV, wouldnt the Weighted Avergage Cost of capital change? Hence shouldnt the EV change?

Comment on Due diligence for LPs by The Private Equiteer

The Private Equiteer — Thu, 11 Mar 2010 07:36:53 +0000

Good point Sylvain. Though it makes you wonder how the heck LPs make an investment decision? A combination of past performance, current financials and partner bios??? GPs would never invest in a business with only paper info; we won't even go to first base without a comprehensive meeting with management.

The consolation is even if you did have full access, appraising those “soft” factors is a bit of an art.

Comment on Due diligence for LPs by Sylvain

Sylvain — Thu, 11 Mar 2010 01:51:57 +0000

You are certainly right about the ““soft” aspects being important. But I'm sure both leadership and team dynamics are often “out of bound” from most LP due diligence efforts. This is typically the type of information only available to insiders(GP's). The perception of those factors by outsiders is subjective and easily manipulated. Many LP's are simply not close enough to the management firm to get an accurate picture of what's happening on the other side.

Comment on Due diligence for LPs by Bullion Information - Bullion Outlook, Updates & Info

Bullion Information - Bullion Outlook, Updates & Info — Mon, 08 Mar 2010 09:31:42 +0000

[...] Due diligence for LPs | A Private Equity Blog [...]

Comment on Due diligence for LPs by The 12 Critical Success Factors to Choosing A MLM Program That Will Actually Make You A Long-Term, Leveraged Residual Income | TheMLMTeam.com

Mon, 08 Mar 2010 04:15:22 +0000

[...] Due diligence for LPs | A Private Equity Blog [...]

Comment on Keeping lawyers fed and clothed by ziwuxun123

ziwuxun123 — Wed, 03 Mar 2010 17:07:27 +0000

NEW YORK, Aug 6 (Reuters) - Packaging and building products company Temple-Inland Inc. (TIN.N), which is under pressure from activist investor Carl Icahn, said on Monday that it would sell 1.55 million acres of timberland to Campbell Group Inc. for $2.38 billion
and then issue a $1.1 billion special dividend.site:outletconverse.com
The sale is part of a plan that Temple-Inland announced in February, which also includes spinning off two businesses, financial services and real estate. At that time, it had said it expected to return the majority of the proceeds from the sale to shareholders.site:outletconverse.com
Icahn, which has a more than 8 percent stake in the company, at the beginning of the year began urging it to make changes, such as selling assets.
Temple-Inland said it was on track to complete the reorganization by the end of the year, after which it would own only packaging and building products.
The company said Campbell Group, a timberland investment management company in Portland, Oregon, would buy the land with installment notes, which will be pledged as collateral for a nonrecourse loan within 30 days of the sale.
Temple-Inland then expects to use some of its expected $1.8 billion in sale proceeds to pay a special dividend estimated at $1.1 billion, or $10.25 per share. It will use the remaining $700 million to reduce debt. site:outletconverse.com

Comment on Keeping lawyers fed and clothed by ziwuxun123

ziwuxun123 — Wed, 03 Mar 2010 17:06:30 +0000

If the county were to "lock up" resource zoning and take away ag protection, "you are saying residential development is the preferred land use." Carpenter said options two and three have no protection for oak forest or madrones, a concern raised by several speakers, some of whom were concerned about the impact of Sudden Oak Death.site:diyfootwear.com
Kelly Brown cited a letter to the CAC from Supervisor Mike Reilly refuting Carpenter's proposals. She said Director of Forestry Andrea Tuttle tells Reilly that without local land use protections, CDF has a hard time regulating conversions.site:diyfootwear.com
René DeMonchy of Guerneville spoke for option three. "Water is the issue that shines through," he said, adding that throughout the county water tables are dropping in direct proportion to the amount of vineyards created. The issue is the public good versus the benefit of a few owners. If it is a property right to cut down a forest and plant vineyards - or broccoli - DeMonchy said he's against it,
because forests maintain ground water.site:diyfootwear.com

He said he loves wine himself, and he believes that most people who don't like vineyard conversions are not against timber harvesting. "But if it destroys watersheds, it is a problem," said DeMonchy. Our prosperous times now are based on water, he went on, and it is not in our best interests to convert a lush damp forest to what Chris Poehlmann calls a biological desert.site:diyfootwear.com

A vineyard owner said he did the math and it will take hundreds of years to convert the forest at the current rate. He said development, not vineyards, causes wells to go dry. His vineyard has bugs, animals, and all kinds of diversity. He asked for the data on the biological desert idea. He was one of several speakers on both sides of the debate who cited land use in Europe. site:diyfootwear.com

Comment on Keeping lawyers fed and clothed by ziwuxun123

ziwuxun123 — Wed, 03 Mar 2010 17:05:39 +0000

Timberland boots are also noted for their extreme durability and dependability; it lasts through many, many years and can withstand all the rigors of wear and tear, weather and terrains. These, combined with their stylish designs, make Timberland footwear the perfect pair of shoes one can ever own. Quality doesn’t have to be really expensive. You can get good quality cheap timberland if you know where to look and what to look for. There are a few brands that make quality sheepskin boots that will wear well for you for a long time and become one of your best friends.
welcome to www.shoetimberland.com

Comment on Keeping lawyers fed and clothed by ziwuxun123

ziwuxun123 — Wed, 03 Mar 2010 17:04:04 +0000

Many people want to buy a warm boots for oneself in cold winter. This idea you can realize it easily, however, sometime you can not ensure you can use it for long time. It is a pity thing, but for Timberland Boots, they are not a thing. They can meet your needs. Timberland has been a legend in boot industry, and getting more and more attention. Timberland Boots have lots of competitors in market, but it keeps on the rise because of its
trendy, stylish and durable.site:timberlandonline.net
Timberland Boots are made of different materials, like Timberland waterproof Boots are made from the strongest leather and provide excellent durability. They are also soft and hard in all the right spots to ensure maximum comfort for the wearer. Timberland Boots shoes are quickly occupied the causal shoes market by storm. Its prominent trend captured thousands of people’s attention including famous celebrities and glitterati. Timberland boots come in series; the main types are Timberland Classic, Timberland custom boots for men and women, Boat boots, Chukka boots, high top boots and roll-top boots, etc. All these boots are brand-new style, malleable look and wearable using for years.site:timberlandonline.net
Hence, even though you have had Nike shoes, UGG Boots, you can own a pair of Classic Timberland instead of quondam shoes and boots. Why to choose Timberlands leather boots? It is obvious to understand that Timberland is a symbol of trendy and strong applicability; all these boots are made from the sturdiest leather and excellent durability. So whether you are fond of climbing, excursing, hiking, even if you are just an everyman, Timberland boots can satisfy for your all purposes.site:timberlandonline.net
Wearing the sought-after Timberland Boots makes you more outstanding and chic looking. It is perfectly to serves as a foil to you. But, there come the problem; faced with so many unique Timberland boots being sold on the market today, we have to concern about the quality of the one we choose and have no reasons to buy an inferior boots with our money.site:timberlandonline.net

Comment on Keeping lawyers fed and clothed by ziwuxun123

ziwuxun123 — Wed, 03 Mar 2010 17:03:57 +0000

Timberland’s proven steady returns, low volatility and non-correlation with global stock prices make it an extremely attractive asset class - and one that should be leveraged as an inflation hedge during this time of uncertainty. For this year’s 6th Timberland Investment World Summit, IQPC has convened some of the most outstanding experts in the timberland space to lead discussions that accelerate understanding of this challenging, yet potentially lucrative investment. site:bootsness.com
Senior executives from the entire timberlands value chain will be meeting to discuss critical themes including the changing global market, institutional timberland investment strategies and cashflow generation opportunities. Exciting innovations this year include the Pension & Endowment Fund Think Tank and an Interactive roundtable discussion on key international timberland markets. Offering a strictly off-line and off the record discussion, the exclusive hour-long Pension & Endowment Fund Think Tank is limited to participants from pension and endowment funds. Attendees are invited to bring a specific and current topic of interest or challenge to discuss with their peers, and can be related to portfolio optimization strategies, market timing, access strategies or risk management for timberland investments. site:bootsness.com
The Global Investment Picture for Timberland interactive roundtable discussion serves as a forum for delegates to receive detailed information on the markets in which they are most interested. Key international timberland markets will include Argentina, Australia, Brazil, Canada, Chile, China, New Zealand, Nicaragua, Panama, Russia, South Africa and Uruguay. site:bootsness.com

Comment on Keeping lawyers fed and clothed by ziwuxun123

ziwuxun123 — Wed, 03 Mar 2010 17:03:21 +0000

More celebrities are becoming more aware of the environment while turning their newfound passion into fashion. Wyclef Jean is no exception. The Grammy Award-winning musician, humanitarian and Goodwill Ambassador to Haiti announced his partnership
with footwear brand Timberland.site:timberlandsbuy.com
Jean introduced a 16-boot footwear collection and with every purchase of these boots, $2 will benefit the Yele Haiti Foundation, a grassroots movement he founded to support reforestation in his homeland, Haiti. In 2005, Jean founded Yele Haiti to build global awareness for Haiti and helping the country through education, sports, arts and environment programs.site:timberlandsbuy.com
Due to his background, Wyclef Jean is now one of six Earthkeeper Heroes within Timberland’s 2009 Earthkeepers program, which aims to catalyze a movement of environmental and social activists. This partnership will combine music, product, digital and social media, service events and concerts to motivate and inspire fans and consumers to take action in protecting the environment. Jean commented:
“It is not common to find an agreement between an individual and a corporation with so many altruistic synergies. I am truly humbled and excited to begin our journey together. Timberland is not only a brand I have worn as long as I can remember, but now I feel I have gained a friend in Jeff [Swartz, Timberland's President and CEO] and the respect of what is beyond a brand. I have the utmost respect for what he and his company stand for not only in its legacies but in its future. I am looking forward to making change together.”site:timberlandsbuy.com