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WSJ: Blackstone, KKR In Talks To Settle Buyout Deal Lawsuit(dpa-AFX International Compact Via Acquire Media NewsEdge) NEW YORK CITY (dpa-AFX) - Private equity firms Blackstone Group LP (BX) and Kohlberg Kravis Roberts & Co. L.P (KKR) are in advanced talks to settle a U.S. lawsuit that alleges some private equity firms conspired to keep prices down for companies they acquired during the buyout boom, the Wall Street Journal reported Thursday, citing people familiar with the matter. According to the WSJ report, a settlement agreement could be reached in the next few weeks, with Blackstone and KKR likely to be parties in the same settlement agreement, rather than entering into separate deals with the plaintiffs. The lawsuit, reportedly scheduled to go on trial in November, has been filed by individual and institutional shareholders who sold stocks to the buyout firms during some of the largest leveraged buyouts in past decade. The WSJ reported that the lawsuit accuses the buyout firms of agreeing among themselves not to outbid each other's deals, or try to trump an offer in an announced deal. According to the plaintiffs, the practice by these private equity firms drove down prices paid to shareholders of the acquired companies. The lawsuit is scheduled to go to trial in November. Three other defendants in the lawsuit - private equity firms Silver Lake and Bain Capital, and investment bank Goldman Sachs Group Inc. (GS) - reportedly agreed to settle with the plaintiffs. Silver Lake is said to have agreed to pay $29.5 million, while Goldman Sachs and Bain agreed to pay a combined $121 million to settle the lawsuit. If the proposed settlement by Blackstone and KKR are approved, TPG Capital and Carlyle Group L.P. (CG) would remain as the two last defendants in the lawsuit. According to the WSJ report, the deals named in the lawsuit include those involving electric utility TXU Corp., casino and resort company Harrah's Entertainment Inc., pipeline business Kinder Morgan Inc., hospital chain HCA Inc., and semiconductor company Freescale Semiconductor Inc. KKR closed Thursday's trading at $24.93, down $0.30 or 1.19 percent on a volume of 2.37 million shares, while BX closed trading at $34.14, up $0.16 or 0.47 percent on a volume of 10.82 million shares. Copyright RTT News/dpa-AFX |