Merger & Acquisition Activity Sets Record, Financial Community Giggly with Results

While conservatives worked hard to prevent mergers between loving monogamous couples of the same sex, America set a record for business marriages on Wall Street. Hedge funds and private equity firms met many fine dates during 2006, consummating a record $4 trillion in mergers and acquisitions. Funny in the press releases they don’t indicate which company is the male and which the female.

Private equity firms contributed to 18.4 percent of all the deals in 2006, spending a record $725.3 billion to take companies private. Participation by these buyout shops has injected the market with a massive amount of liquidity, analysts said. And companies, many fed up with scrutiny from investors and regulators, have been willing to become private companies.

Isn’t it funny how companies can go private to keep the public out of their boardrooms? After the consummation, it matters not which was the male or female because the public no longer has access. How do corporations get more rights than individuals in America?

So who got married in 2006? Which of those firms comprising the new lobbying group, the Private Equity Council, sealed the deal and with who?

Kohlberg Kravis Roberts - along with Bain Capital Partners and the buyout unit of Merrill Lynch & Co. - in July secured the biggest deal in history with the acquisition of hospital operator HCA Inc. The deal was valued at $30.6 billion, including the assumption of debt, and set the bar higher.

And bankers worked until the final days of 2006 in pulling off the seventh-largest private equity deal of the year. Apollo Management and Texas Pacific Group secured a $17.1 billion agreement to take Harrah's Entertainment Inc. private.

The big five Wall Street investment banks had record profits in 2006, and their chief financial officers all say there are still plenty of deals to be made.

What happens if a private equity firm purchases more than one company? Are they being polygamous? As many are known for purchasing undervalued firms, are they literally buying “a dog”? Is it an ugly woman or man’s best friend? And how are those deals consummated? I don’t want to know. What happens in the “board room” should be private…