BusinessWeek reports that Wall Street has its eye on a new pot of cash -- your pension. And it's a mighty big pot -- $2.3 trillion. But Wall Street is not looking at the entire pension industry, just a $500 billion portion known as "frozen plans" that are closed to new employees and whose benefits are capped. McKinsey forecasts that frozen plans will triple to a hefty $1.5 trillion by 2013.

As usual, Wall Street's plan to buy these frozen pensions will line its own pockets and it will help companies as well. For example, if Wall Street charged a 2% management fee, that alone would generate $30 billion in revenues by 2013 if it bought all the frozen plans, but that fee income is probably the tip of the iceberg.

Companies are eager to dump their frozen pension plans. Why? These limping plans weigh down corporate balance sheet and new accounting rules will require companies to mark the value of their pension assets to market each quarter. In a down market, that could wipe out a company's operating profits.

Warburg Pincus, which is a top private equity firm, got its start over 40 years ago, bringing a professional approach to the business. Since then, the firm has invested $29 billion in more than 585 companies across 30 countries.

Well, now the firm has even more firepower for deals as it has raised a hefty $15 billion for its next fund. Some of its marquee investors include Washington State Investment Board and GE Asset Management.

But with the credit crunch, what can Warburg Pincus do with the money? Well, keep in mind that the firm has a growth orientation, which has less reliance on debt sources. What's more, Warburg Pincus has a global platform, which is particularly attractive to institutional investors.

Interestingly enough, Warburg Pincus has ventured into some distressed investing. The most notable transaction was a $1 billion investment in MBIA (NYSE: MBI), which suffered from bad timing (the deal was struck late last year).

But this doesn't seem to be much of a concern for Warburg Pincus. After all, the firm has undergone a variety of market cycles and realizes that real returns take time.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

In an effort to raise additional cash and maintain its AAA credit rating, MBIA (NYSE: MBI), the largest insurer of debt, including municipal bonds, has decided to sell $1 billion of new shares. MBIA prices stock at $12.15 a share which is below Friday's closing price of $14.60. While there is concern by some that this will continue to dilute the value of these already beaten down shares, the market makers understand that maintaining the all important AAA credit rating is the foundation of the company.

Indeed, some analysts believe the stock has got twice its fair share of bad news holding it down based on book value, and have made predictions that the stock will see much better days. So much better, in fact, that analysts at Fox-Pitt Caronia are looking for a $26 to $28 price target in 12 months. I have no such crystal ball, but I do believe the stock will be higher at the end of the year. In the mean time, it is paying a 3.8% 10% yield.

The holders of the largest number of shares (and growing) Warburg Pincus, reports 16.5% MBIA stake, and is committed to $300 million of the offering. Over the weekend, the Motley Fools wrote a thin story, Why You Shouldn't Double Up, discussing large and small cap stocks and why if you hold index funds you may want to rethink your investment allocations. It included MBIA.

Sheldon Liber is the CEO of a small private investment company and the design and research principal for an architecture & planning firm. Disclosure: I am a long time shareholder of MBIA and purchased additional shares recently.

Shares of MBIA Inc. (NYSE: MBI) soared almost 30% after the world's largest bond insurer got a $1 billion cash infusion from Warburg Pincus LLC, a private equity firm.

The money couldn't have come at a better time for Armonk, N.Y.-based MBIA, which faced a potentially crippling downgrade from the credit rating agencies As Bloomberg News notes, "MBIA's AAA ranking stands behind $652 billion of state, municipal and structured finance bonds, and losing the AAA credit rating would endanger MBIA's ability to guarantee debt, its main source of revenue."

Under the terms of the agreement, Warburg Pincus will make an initial investment of $500 million through the acquisition of 16.1 million shares at $31 per share, a slight premium over Friday's closing. The investor will also backstop a shareholder rights offering of up to $500 million that MBIA expects to make next year. In addition, Warburg will receive warrants to purchase 8.7 million shares of MBIA common stock at a price of $40, and "B" warrants, which, upon obtaining certain approvals, will become exercisable to purchase 7.4 million shares of stock at $40.

According to a story in Women's Wear Daily, it looks like Neiman Marcus' private equity owners -- Texas Pacific Group (TPG) and Warburg Pincus -- are considering an IPO of the firm. They bought out the company back in 2005.

The IPO could come as early as this summer, although it's more likely to be early next year.

Neiman Marcus has been posting strong results lately. In the fiscal second quarter, sales increased 8.5% to $1.3 billion and operating earnings spiked from $69.7 million to $127.8 million. The company plans to expand the number of its stores to 50-52 by 2010, up from 44. Neiman has also been building out clearance centers, called Last Call.

There has been a drought in retail IPOs. But in light of TPG's highly successful IPO of J. Crew (NYSE: JCG), there's likely to be some interest in a Neiman Marcus offering.

For more news & views about private equity, please see BloggingBuyouts.

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.

Billions keep flowing into private equity funds. The reason is simple. The funds -- especially the big ones -- have posted strong returns. Does this then mean that public shareholders are getting a raw deal?

Well, over the past few months, shareholders have been getting much more aggressive on buyouts. The latest example is the buyout of Aramark. The company is a leader in providing food services, facilities management and even uniform apparel. There are roughly 240,000 employees.

Early this year, the company sold out to a variety of private equity firms, such as GS Capital Partners (NYSE: GS), CCMP Capital Advisors, J.P. Morgan Partners (NYSE: JPM), Thomas H. Lee Partners and Warburg Pincus LLC. About 250 Aramark senior managers also invested in the deal.

The initial buyout price was $32 in cash, which was a bit of a disappointment for public shareholders and lawsuits ensued. This certainly paid off as now, the buyers have agreed to a new price of $33.80. True, this does not sound like a lot, but it does amount to $222 million in extra consideration (the Delaware court approved the settlement this week).

It's also probably a sign of things to come in the buyout game.

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.