For a mega private equity firm like Blackstone (BX), there's a need to get liquidity on a mega scale. So this week, the firm prepared for one of its holdings, Travelport, to go public. The deal could be worth as much as $3 billion.

Blackstone will float the deal on the London Stock Exchange. There will also be the issuance of 7.2% of the stock to Government of Singapore Investment Corp. (for about $225 million).

Continue reading Blackstone Preps Travelport for a $3 Billion IPO

Blackstone Preps Travelport for a $3 Billion IPO originally appeared on BloggingStocks on Tue, 19 Jan 2010 12:20:00 EST. Please see our terms for use of feeds.

Over the past decade we seen at least $1 trillion dollars spent by private equity firms. These firms have taken over companies for a pittance and then pillaged them by slashing employees and cutting costs. They then used the money to pay down debt rather than rebuilding the company.

Now all of the debt thrown on the acquired companies is coming due and it could cause another economic disaster, even bring down the economy.

Continue reading Will private equity take down the economy?

Will private equity take down the economy? originally appeared on BloggingStocks on Tue, 03 Nov 2009 13:30:00 EST. Please see our terms for use of feeds.

There's been lots of dealmaking with online travel portal, Orbitz Worldwide Inc. (NYSE: OWW). Back in 2003, the company went public, and then a year later sold out to Cendant. Cendant then meshed its online travel properties into a new unit, called Travelport, which was then sold to the Blackstone Group (NYSE: BX).

And the dealmaking continued this week as Orbtiz raised a cool $510 million in an IPO. Unfortunately, investors were not impressed. The IPO was priced at $15, which was below its $16-$18 range. The stock then fell 3.3% on its first day of trading.

But the IPO proceeds won't go to Orbtiz. Rather, the cash will flow back to the parent company, Travelport (in a special dividend). In other words, the IPO is really a cash-out -- not a way to help build Orbitz.

True, Orbitz has some nice brands - such as CheapTickets.com and eBookers.com. But the fact is that the online travel space is highly competitive, with players like Expedia Inc. (NASDAQ: EXPE) and Priceline.com Inc. (NASDAQ: PCLN).

Another big issue: the company has never posted net income. So, I can understand why Wall Street has some concerns.

Also check out some of the other IPOs of the past week.

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

See also:
Jonathan Berr: The appeal of Expedia and Orbitz eludes me
Tom Taulli: Blackstone wants payback with Orbitz IPO

Falling out of Orbitz originally appeared on BloggingStocks on Sat, 21 Jul 2007 12:40:00 EST. Please see our terms for use of feeds.

Expedia -- Confidence building in the on-line travel company originally appeared on BloggingStocks on Tue, 19 Jun 2007 12:45:00 EST. Please see our terms for use of feeds.

Back in late June, The Blackstone Group and Technology Crossover Ventures (TCV) shelled out about $4.3 billion to buy the travel assets of Cendant, called Travelport. The assets are extensive, including CheapTickets, Orbitz, Gullivers Travel Associates and the Galileo global distribution system (GDS), which processes airline tickets.

The goal for Blackstone/TCV: build a much larger travel distribution company.

Well, it has wasted little time. This week, the company purchased Worldspan for $1.4 billion. The company is a dominant player in the GDS space.

All in all, the deal makes a lot of sense. There should be big cost savings - as well as top-line growth opportunities (in terms of cross-selling). The combined company will have roughly $3.5 billion in revenues.

But it is still risky. After all, airlines are trying to avoid - or cut pricing - with GDSs. Of course, the Internet is a threat. What's more, there will be serious challenges in terms of integration of the complex organizations of Travelport and Worldspan (ie, both have different technology platforms).

But there were two key winners: Citigroup Venture Capital Equity Partners and Ontario Teachers' Pension Plan. These firms purchased Worldspan in 2003. And, because of the Travelport deal, they generated a tidy 250% return.

Tom Taulli is the author of various books, including the Complete M&A Handbook and operates DealProfiles.com.

Private Equity gains altitude originally appeared on BloggingStocks on Fri, 08 Dec 2006 10:51:00 EST. Please see our terms for use of feeds.