Jan. 23: Thomas H. Lee Partners recorded $524 million in writedowns for its latest fund, reflecting declines in the value of Hawkeye Renewables, The Nielsen Company and Univision Communications. The figures, part of a performance report for the third quarter of 2008, were disclosed in a Dec.16 letter to the firm’s LPs. Hawkeye Renewables took the biggest hit, written down to $64 million from $352 million.
March 19: The U.S. Securities and Exchange Commission charged Henry Morris, the political adviser to New York state’s former comptroller, and David Loglisci, the New York State Common Retirement Fund’s CIO from 2003 to 2006, with setting up a kickback scheme to siphon money from private equity firms in return for commitments from the state.
April 30: Saul Meyer, founder of Aldus Equity, was arrested in connection with the pay-to-play scandal in New York. The SEC filed a civil suit against Meyer and Aldus Equity, seeking to impose monetary penalties related to the kick-back scheme.
April 30: Big-three car maker Chrysler Corp., owned by Cerberus Capital Management, filed for Chapter 11 bankruptcy protection, making it the largest-ever LBO-backed company to fall into insolvency. Cerberus acquired its 80.1 percent stake in Chrysler in August 2007 in a $19.4 billion deal.
June 11: New York Attorney General Andrew Cuomo announced a $30 million payment from Riverstone Holdings LLC to end a probe into its role in the pay-to-play scandal involving the New York State Common Retirement Fund, saying the payment was “restitution” that will be returned to the pension fund. The firm joined The Carlyle Group, which paid $20 million in May to resolve its role in the investigation.
July 22: In an effort to curtail pay-to-play practices among investment managers of government money, the SEC proposed banning placement agents from soliciting a government client on behalf of an investment firm. The proposal came under heavy criticism from the private equity industry as being too broad.
Sept. 7: Mercury Capital Advisors spins out of Merrill Lynch’s defunct fund placement group. In July, Bank of America decided to wind down the Merrill Lynch group, whose roots traced back to the 1980s and was widely credited with creating the fund placement business.
Oct. 17: Federal antitrust regulators were reported to be investigating possible price-fixing by Toys “R” Us Inc., the retailer owned by Bain Capital, Kohlberg Kravis Roberts & Co. and Vornado Realty Trust. The firms bought the company in July 2006 for $6.6 billion.
Oct. 21: Upon learning that the New Mexico State Investment Council intended to render a no-confidence vote against him, State Investment Officer Gary Bland resigned, without explanation. Aldus Equity founder Saul Meyer, in pleading guilty in connection with a pension fund kickback scheme on Oct. 2, said he “ensured that Aldus recommended proposed investments that were pushed on him by politically-connected individuals in New Mexico.”
Nov. 30: Hudson Clean Energy Partners closed its debut fund with $1.02 billion, beating its $1 billion target. The firm already owned five portfolio companies in the solar power and wind energy sectors. New York State Common Retirement Fund pledged $100 million to the vehicle.