Top 10 private equity deals

The following list of the largest PE deals tells the story. The last 3 years have been remarkable for the mega deal, according to Fortune Magazine. We’ll know in half a decade or so if this trend was good for limited partner investors:

“The first takeover of a public company by a private equity firm was in 1979, when KKR bought machine-tool maker Houdaille for $355 million. But nine of the 10 biggest deals ever are from the last three years.

(Values include assumed debt)

1. $38.9 billion – Equity Office Properties Trust

Acquirer: Blackstone
Year: 2007
Comments: A fierce bidding war drove up the price by $3 billion.

2. $32.7 billion – Hospital Corp. of America

Acquirers: Bain, KKR, Merrill Lynch
Year: 2006
Comments: The buyers, including the Frist family, paid only $5.5 billion in equity. The rest was debt.

3. $31.1 billion – RJR Nabisco

Acquirer: KKR
Year: 1989
Comments: It’s the Sgt. Pepper’s of PE: oft imitated but never topped_ when adjusted for inflation.

4. $27.4 billion – Harrah’s Entertainment*

Acquirers: Apollo, Texas Pacific
Year: 2006
Comments: The club’s $90-per-share offer was a huge 35% premium over the casino’s closing stock price.

5. $25.7 billion – Clear Channel Communications*

Acquirers: Bain, Thomas H. Lee
Year: 2006
Comments: The Mays family’s stake is valued at over $1 billion.

6. $21.6 billion – Kinder Morgan*

Acquirers: Carlyle, Riverstone, Goldman Sachs
Year: 2006
Comments: Goldman did the deal and earned fees from the buyers and seller.

7. $17.6 billion – Freescale Semiconductor

Acquirers: Blackstone, Carlyle, Permira, Texas Pacific
Year: 2006
Comments: U.K.-based Permira established a beachhead in U.S. megadeals.

8. $17.4 billion – Albertson’s

Acquirer: Cerberus
Year 2006
Comments: Joining with CVS and SuperValu, Cerberus spurred management to go private.

9. $15.0 billion – Hertz

Acquirers: Carlyle, Clayton Dubilier & Rice, Merrill Lynch
Year: 2005
Comments: Bought from Ford, then sold to the public a year later.

10. $13.9 billion – TDC

Acquirers: Apax, Blackstone, KKR, Permira, Providence
Year: 2005
Comments: The buyout of the Danish telecom is Europe’s biggest private-equity deal so far.

* Deal announced, not closed.

MRM