Word: profitable
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Dates: during 1980-1989
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...changes. This year's financial fad is the leveraged buyout. In these deals, the group of investors buying a company puts up the firm's assets as collateral. Since the loans needed for a leveraged buyout are thus backed by the company itself, there can be big profits for the investors, who often put up very little of their own cash. In one of the most celebrated leveraged buyouts, former Treasury Secretary William Simon and a group of financiers bought Gibson Greetings in January 1982 for $80 million while putting up only $1 million of their own money...
...Silva Herzog, calls for Latin borrowers to pay a level of interest tied to the rates on bank certificates of deposit, currently about 11½%. This would give debtors a break of about 2½%, worth some $7 billion annually, while still allowing the banks to make a slight profit on the loans. Though bankers as a group will find these proposals hard to accept, at least one leading financier buys the idea. Even before last week's meeting, Terence Canavan, head of Chemical Bank's Latin American operations, said that "the time has come for lower rates...
...Monopoly, but the Department of Transportation last week was taking bids for the Consolidated Rail Corp. Created in 1976 from the Penn Central and five other bankrupt railroads, Conrail required a $7 billion federal transfusion through 1982. Under the stewardship of Chairman L. Stanley Crane, Conrail earned a profit in 1983 of $313 million. When DOT tried to peddle Conrail to 20 firms last spring, the only offer came from the company's employees, who already own 15% of the road. But last week 14 bidders stepped forward to offer to buy the giant carrier, which hauls freight over...
...company. Management's feeling is: cripple us, poke out our eyes and maybe they won't like us any more." That kind of scorched-earth policy may save the jobs of top management, but it does not help investors, who see the greenmailer make a huge profit while their shares decline in value. Said T Boone Pickens, a frequent opponent of entrenched corporate offi cials and a sometime greenmailer...
...decision to sell the magazine brought a bittersweet experience to the employees, who hold most of the company's stock under a profit-sharing plan initiated by Lawrence: they gained a windfall but lost control. The process started last December, when a still anonymous bid brought into focus what had been just a complaint from a few retirees: that U.S. News was shortchanging departing staffers by sharply undervaluing the company's assets. These include a high-technology typesetting company and a pending hotel-and-office complex (started as a joint venture with Zuckerman) on U.S. News...