Chapter 103 Leverage King KKR

The KKR Group is not the most powerful among the investment companies on Wall Street, but this company has its own unique business model, and it has gained a foothold in Wall Street, the global capital center. KKR Group was founded in 1976 by Kravis Kravs, Roberts cousins, and their mentor Kohlberg who met when they were working at Bear Stearns, one of the five major investment banks. The company's name comes from The initials of the three surnames.

KKR Group is a well-known private equity investment institution in the US stock market. The so-called private equity mainly refers to the fact that its funds come from a small number of private investors and institutional investors, rather than raising funds through public channels such as the New York Stock Exchange through the issuance of stocks and bonds. funds. In addition to the characteristics of the capital source of general private equity, the most different point of KKR Group is that this company often uses high leverage to make acquisitions.

At the beginning of its establishment, the KKR Group’s main source of funds was bank loans. They relied on their personal connections to borrow funds from the bank, and then invested in the stock market to make a small fortune. Cases of small snakes swallowing elephants were often staged. Thanks to the superb investment level of KKR, although the risk of leveraged buyout is extremely high, the benefits are often huge. Relying on the stunt of this leveraged buyout, kkr has jumped from a small workshop-like company to become a leader on Wall Street. Star Investment Company.

Now kkr manages companies with a market value of nearly 50 billion US dollars, and their financing methods are also smoother. Bank loans are no longer KKR's main source of leveraged funds. KKR now raises funds by issuing junk bonds, which are bonds that are not rated by Standard & Poor's and whose income cannot be guaranteed, but may also be paid normally. Once a company is targeted by kkr, it often becomes meat on the chopping board. kkr will suck every drop of bone marrow from this company before selling it.

This time, KKR focused on Motorola, but not because Motorola itself had anything worth investing in, but because Motorola became the lifeblood of the battle between Yota Communications and AT&T.

Yota Communications has made a big bet in the Iridium Project, and now there is no way to turn back. If KKR manipulates Motorola's board of directors to withdraw from the Iridium Project at this time, Yota Communications will suffer huge losses. For AT&T, Motorola is equally important. If KKR sells its shares to AT&T, Yota Communications will be forced to die. At that time, AT&T may be able to take a stake in or acquire the king of mobile communications.

KKR's investment is simply a tiger's mouth, and a chestnut out of the fire. However, both Yota Communications and AT&T have overlooked this weakness of Motorola, and KKR's capital blackmail is already doomed to eat Yota Communications and AT&T. However, judging from the report of Bloomberg News, KKR is more optimistic about AT&T, because everyone on Wall Street knows that Goldman Sachs and Morgan Stanley are on the side of AT&T in this communications battle. Without Motorola's satellite technology, yota communication would never be able to stand up.

Eva regrets her carelessness now. Eva has always only focused on Yota's leading edge in technology, ignoring capital issues. Yota was unable to go public due to its own willingness to attract more investors, which also restricted the development of Yota Communication in a disguised form. Now it is useless to bet the entire Gorky Department's funds, no matter how rich Seryosha is. It may be head-to-head with top investment banks such as Goldman Sachs and Morgan Stanley.

The news of kkr's attack on Motorola quickly spread throughout the Wall Street investment community. Now those Wall Street investors finally understand the logic of investing in Motorola.

Everyone began to eat Motorola's stock frantically, and everyone wanted to get a share of Motorola's stock before AT&T sold.

But if you want to make money, you don't have to buy Motorola's stock. According to the current situation, after AT&T takes another 20 percent of KKR's shares, it only needs to take another 10 percent. , because once a certain company obtains 30% of the shares in the open market, it can submit an acquisition offer to the New York Stock Exchange. Negotiate a price with deep-pocketed AT&T.

Eva originally tried to find some collaborators from Wall Street to try to make the same acquisition of Motorola, but Eva's action was too late. Wall Street investment institutions are not optimistic about her. Moreover, the price of Motorola's stock is almost changing every day. If Eva wants to prevent Motorola from being acquired, it is estimated that he will have to spend a lot of money. This has far exceeded the limit that yota can bear. Now even if all Yota's working capital is taken out, it is impossible to take 30% of Motorola's shares.

In desperation, Eva had no choice but to contact Seryozha again. When Seryozha heard the news, he also felt a little troubled. For a long time, Eva's yota communication has been developing smoothly. I never thought that one day I would be cornered by a small kkr.

"How long will it take for our satellite communication experiment to be completed?" Seryozha tried his best to calm down his tone. He didn't want Eva to worry too much about these things. Yota Communication has never been in contact with the capital market since its development. It was Seryozha who came to invest personally, and the excessive protection made Yota Communication lack of vigilance and wariness against Wall Street. Seryozha has some contacts in the British investment community, but he has no roots in the United States. Besides, AT&T stands behind the super luxurious investment lineup of Goldman Sachs and Morgan Stanley. Not to mention Seryozha, even if all the banks in the Soviet Union are combined, they are not rivals of these two investment banks.

"It will probably take another year and a half, but now Motorola's attitude has changed, and I'm worried that the other party will renege on the contract!" Eva said disappointedly.

"Eva, don't worry about Motorola, the Iridium project will continue, and I will take care of other things?" Seryosha comforted Eva on the phone.

"But Seryozha..."

"There's nothing but, don't worry, I can handle this matter!" Seryozha interrupted Eva and reassured her.

...

In New York, in an office building lined with Wall Street, in an unremarkable small investment consulting company, the two founders are carefully reading all the public information of Yota Communication since its establishment, in order to gain a deeper understanding of the company. On the doorplate of the company's office, there was an inconspicuous name——Blackstone Black Stone. ...

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