Scotties Toy Box

July 29, 2018

The Bain Bustout Lives: The Tronc Edition

Filed under: News — Scottie @ 17:32

Thank you for this clear and easy to follow explanation of how corporate raiding works and how the greed of the wealthiest people is destroying the country. There is no way an economy can work if all the money is concentrated at the top. History has shown that the country is most profitable for everyone when financial means are much more equal. You have to have a base that can buy goods and services for there to be a need to manufacture or provide those services. In our country due to class warfare that base has been destroyed. Hugs

Mike the Mad Biologist

A few years back, I discussed the Bain Bustout school of capitalism, which is how companies that are in areas that don’t yield massive profits can be made very profitable–for a while (boldface mine):

Bain Capital didn’t get lucky once or twice, they generated these kinds of profits repeatedly, again often in industries with relatively low profit margins. The short answer is that you perform the financial equivalent of a mob bust out. Here’s the special sauce (boldface mine):

1) Neutralize a possible battle with the board of directors of the target company by giving them preferential personal benefits from the buyout. Starting with the CEO, the buyout firm offers him a guaranteed role as CEO of the new, private company. He and his fellow executives receive a generous allotment of private ownership shares, which will make them very wealthy once the firm is brought back to public ownership. Similar…

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