Texas pacific not playing by the rules. The hostile LBO bid by...

Texas pacific not playing by the rules. The hostile LBO bid by Texas Pacific and Global Infrastructure Partners for Asciano is a far cry from the old fashioned leveraged buy-out – the barbarians aren’t merely at the gate, they have taken over the village.


While not the first person to ever conduct an LBO (or “bootstrap acquisition”, as they were once known), the father of the modern-day LBO is Jerome Kohlberg. Kohlberg was insistent that private equity firms like KKR run LBOs as entirely friendly affairs. In most cases, the PE firm would team up with management, conduct painstaking due diligence, and acquire the company. KKR assiduously avoided deals without management, while hostile LBO bids were not unheard of (the infamous Barbarians at the Gate takeover of RJR Nabisco (by KKR) was initially a hostile deal made in response to an LBO by Shearson Lehman and existing RJR management), they were a last resort,and their now picking them up less than the 4.40 offer,lol