June 22, 2017

There were 3 posts published on June 22, 2017 (this is page 1 of 1).

Washington Monthly | The Ossoff-Parnell Lesson: Stop Chasing Romney Voters

The lesson of the special elections around the country is clear: Democratic House candidates can dramatically outperform Clinton in deep red rural areas by running ideological, populist campaigns rooted in progressive areas. Poorer working class voters who pulled the lever for Trump can be swayed back to the left in surprisingly large numbers—perhaps not enough to win in places like Kansas, Montana and South Carolina, but certainly in other more welcoming climes. Nor is there a need to subvert Democratic principles of social justice in order to accomplish this: none of the Democrats who overperformed Clinton’s numbers in these districts curried favor with bigots in order to accomplish it.

But candidates like Clinton and Ossoff who try to run inoffensive and anti-ideological campaigns in an attempt to win over supposedly sensible, wealthier, bourgeois suburban David-Brooks-reading Republican Romney voters will find that they lose by surprisingly wide margins. There is no Democrat so seemingly non-partisan that Romney Republicans will be tempted to cross the aisle in enough numbers to make a difference.

The way forward for Democrats lies to the left, and with the working classes. It lies with a firm ideological commitment to progressive values, and in winning back the Obama voters Democrats lost to Trump in 2016 without giving ground on commitments to social justice. It does not lie in the wealthy suburbs that voted for Romney over Obama in 2012, or in ideological self-effacement on core economic concerns.

Source: Washington Monthly | The Ossoff-Parnell Lesson: Stop Chasing Romney Voters

Biggest Credit Bubble in History – simplest way to strip cash – BMC software – most insatiable buyers leveraged-loan mutual funds    

BMC software borrowed $750 million via one of the riskiest forms of debt, payment-in-kind (PIK) notes, where, if push comes to shove, BMC can chose to pay interest not with cash but with more of the same debt.

The amount it owes gets larger, as its chances of survival shrivel. Instead of defaulting, the company will simply hand the lender more paper that’s increasingly worthless.BMC promptly forwarded the $750 million to its owners, a group of PE firms let by Bain Capital that had acquired BMC only seven months earlier.

Time is of the essence. Platinum Equity, which had acquired Volvo’s rental car division, waited only a week after closing the deal before sucking $262 million out that the company had obtained by issuing PIK debt.

So far this year, these already overleveraged companies have issued nearly $21 billion in junk-rated debt for the purpose of paying special dividends to the PE firms that own them — the most since the bubble of 2007, before it all blew up spectacularly.Of that, $3.5 billion were these reeking PIK notes.When a default occurs, the PE firms have the cash, and the lenders get stuck with largely worthless paper.

Source: Biggest Credit Bubble in History – simplest way to strip cash – BMC software – most insatiable buyers leveraged-loan mutual funds    

Tech Mega-Buyouts Edge Toward Comeback as BMC, CA Plot Deal – Bloomberg

Don’t miss this little fact: Bain and Golden Gate helped themselves to their own $750 million dividend from BMC a year after buying the company.

Four years after Blackstone Group LP and Silver Lake Management battled to take Dell Inc. private, buyout firms are back in the market for big leveraged technology deals.

BMC Software Inc., owned by Bain Capital and Golden Gate Capital, and CA Inc. are considering a potential deal that would see the software companies combine as part of a transaction to take CA private, according to people familiar with the process. CA shares rose as much as 16 percent Tuesday, valuing the New York-based company at more than $15 billion.

If a deal goes ahead, and if it’s structured as a leveraged buyout by the private equity firms followed by a combination with BMC, it would be the biggest LBO of a tech company since Silver Lake and Michael Dell won the fight to buy Dell in 2013 in a transaction valued at almost $25 billion.

Source: Tech Mega-Buyouts Edge Toward Comeback as BMC, CA Plot Deal – Bloomberg