DIRECT and CO-INVESTMENTS
Investment in distressed shipping assets (name of company withheld)
Co-Investment with three major private equity investors (expected closing 4Q 2009)
Lion Cao has the unique opportunity to co-invest up to $100M alongside three marquis private equity investors to for a new company to acquire distressed dry bulk carriers and tankers globally. The company will be led by a 20-year veteran of the shipping industry who has in the past 10 years delivered significant returns to private equity investors in this sector. This individual is highly regarded and watched in the shipping industry and besides the marquis private equity funds in the deal, investing through Lion Cao is the only opportunity to invest with this team during a very attractive cyclical low in the global shipping industry.
OneWestBank, FSB (formerly IndyMac FSB)
Co-investment with JC Flowers & Co.
IndyMac was a prominent West Coast bank with 33 branches in Southern California and over $6BN in deposits. In March 2009, a consortium, including Steve Mnuchin of Dune Capital, JC Flowers & Co. (JCF), and Paulson & Co. acquired 100% of IndyMac for $13.9B. The consortium invested $1.6B in equity to capitalize the new bank; JCF and its co-investors including Lion Cao invested $400M.
After the acquisition, the name IndyMac was changed to OneWestBank, FSB (“OneWest”) and it remains the country’s 6th largest mortgage servicer, servicing $153B third-party loans including Fannie Mae, Freddie Mac and private investors, as well as a major reverse mortgage loan serving platform, with over $20B of assets. The consortium was granted an attractive loss-sharing arrangement with the FDIC for the bank’s assets, which provides investors in OneWestBank attractive downside protection as well as the ability to grow with the assets of the bank. Through its relationship and investment in JCF, Lion Cao was able to secure its full allocation in this oversubscribed deal and co-invested with its partners in this transaction.
Sonneborn Holdings LLC (“Sonneborn”)
Co-Investment with Sun Capital Partners
Sun Capital Partners (“Sun”) with minority investors, including Goldman Sachs affiliates, made an equity investment into Sonneborn Holdings, which is the world’s leader in the manufacture and supply of high-purity specialty hydrocarbons. The transaction value was approximately $80M, and was a purchase of a solid business segment carved out of Chemtura Corporation, a leading marketer of specialty chemicals, polymer products, and processing equipment for a wide variety of industries. A Lion Cao principal was invited to invest in this deal due to his relationship with Sun Capital and its founders.
FOODFIGHT!
Co-Investment with a well-known $20B investment fund
Lion Cao co-invested alongside this group in an $18.5M investment to complete the production financing of FoodFight!, an animation full-feature single-picture produced Larry Kasonoff and Josh Wexler and starring Charlie Sheen, Hilary Duff and Eva Longoria. The producers have a track record of success in film production and franchise merchandising, including the $4BN+ franchise of Mortal Kombat, the Terminator series, True Lies and Dirty Dancing. The producers had secured over $100M in non-recoupable marketing and advertising promotional tie-ins to support the film’s launch, which had never been accomplished before and is unique. Investors’ original principal investment has already been recouped, with the equity ownership stake of 25% in the picture still to be realized.
Lion Copolymer
On November 1, 2005 a Lion Cao principal with Lion Chemical Capital, acquired DSM Copolymer, a subsidiary of DSM, a Netherlands-based international group of industrial companies, and renamed the new entity Lion Copolymer LLC. Lion Copolymer is a leader in the manufacture of synthetic rubber with a strong reputation for quality products and services. Established in Baton Rouge, Louisiana in 1943, the company and its employees have successfully met the changing needs of its customers for over 65 years. The Baton Rouge facility manufactures synthetic rubber: styrene-butadiene rubber (SBR), which, through its use in the production of tires, is the most widely used type of synthetic rubber in the world.
In June 2007, Lion Copolymer acquired the $300M in sales EPDM and chemical foaming agents businesses from Chemtura Corporation with operations in Geismar, Louisiana. EPDM is also a synthetic rubber with numerous applications in various industries, including construction and automotive. A Lion Cao principal sponsored the original investment and continues to serve on the Board.
Legendary Pictures
Founded in 2005 with a team of highly regarded media and entertainment executives, Legendary Pictures has formed a unique strategic partnership with Warner Brothers to create, develop, co-produce, co-finance and distribute a slate of 35-45 major motion pictures over the next 5 years. Thus far the Legendary slate includes such box office hits as Batman Begins, Superman Returns, 300, The Dark Knight, The Watchmen and Hangover. Investing in a slate provides important portfolio diversification; receiving the backing of a major studio as a partner ensures alignment of interests. A Lion Cao principal completed over 6 months of diligence in the broader movie-financing space before deciding to invest in Legendary at a time of its restructuring. An early relationship was forged with the CEO of Legendary and our principal joined a roster of blue-chip investors on the Board including ABRY, Falcon, BofA Ventures, Columbia Capital, MC Ventures, Deutsche Bank and Dresdner.
POW! Entertainment
POW! Entertainment (POW!) is the holding company for Stan Lee, the iconic creator of such comic book characters as Spiderman, X-Men, The Hulk, Fantastic Four, Iron Man, Captain America and others. Lion Cao has established a joint-venture with POW! in a variety of concepts, including the development of comic book properties that will eventually also develop into film, television and digital properties. As a JV partner, Lion Cao will structure the financing, production, publication and distribution of the comic books as well as other projects. Lion Cao is currently also developing a partnership with a India-based animations studio for the creation and distribution of Stan’s content internationally. Lion Cao’s principal coinvested with partners in the fund.
|
FUNDS
Ajia Partners (Ajia Asian Opportunity Fund - Joint-Venture)
Ajia Partners (“Ajia”) is an investment firm originally backed by 18 wealthy families in Asia and is focused on alternative investments throughout Asia. Ajia manages over $2BN across five sectors: real estate, special situations/private equity, hedge funds, Asian hedge fund-of-funds and corporate advisory. Ajia Partners’ strategic partners include ABN AMRO, Mitsubishi Corporation, China Securities, Woori Bank, BNP and Goldman Sachs. A Lion Cao principal coinvested with partners in the fund.
ABRY Partners (“ABRY”)
ABRY is a Boston-based buyout fund founded by Andrew Banks (“AB”) and Royce Yudkoff (“RY”), originally from Bain Consulting in 1989. ABRY focuses on control investments in media, communication and information industries where it has substantial operating and investment experience. ABRY pursues a range of transaction types including acquisitions, growth investments, consolidation strategies, cost reductions and turnarounds and will generally take controlling positions in portfolio companies in order to exert requisite influence over the its investments. ABRY has six private equity funds, two mezzanine funds and a fund focused on senior loans of media companies. ABRY’s track record has been excellent: the group has generated over 45% net IRR and 4X ROI, on average, across five funds. Lion Cao has co-invested in the last 18 months with partners in two new ABRY funds: Fund VI and ABRY ASF, a senior securities fund.
Sun Capital Partners (“Sun”)
Sun Capital Partners was founded in 1995 by Mark Leder and Rodger Krause to invest in distressed / turnaround buyout situations across a variety of industries. Sun makes control investments in companies with strong market positions or franchise value, but with poor performance, significant operating challenges, inadequate or incomplete management or in out-of-favor industries. Sun targets companies up to $5BN+ in revenues, though typical transactions are with businesses that have $50M to $500M in sales. Sun has five private equity funds that have each generated excellent returns. IRR and ROI over the first three funds, on average, has been 96% and 3.6x ROI, respectively. Fund IV and Fund V have not yet been realized. A Lion Cao principal seed-funded Mark and Rodger coinvested in their pre-fund transactions, invested in each fund, and co-invested in Fund V with our partners.
ChrysCapital Partners (“ChrysCapital”)
ChrysCapital was founded by Ashish Dhawan (formerly of McCown De Leeuw and Goldman Sachs) in 1999 to invest in private companies in India. ChrysCapital focuses on business services, financial services, pharmaceuticals/healthcare, industrials, infrastructure and consumer discretionary industries. ChrysCapital makes growth capital investments along with select control investments, and has five private equity funds. IRR and ROI over the first four funds, on average, have been 119% and 2.0x to 3.0x ROI, respectively. Fund V has not yet been realized. A Lion Cao principal seed-funded Ashish.
Berkshire Partners (“Berkshire”)
Berkshire Partners was founded in 1984 by Bradley Bloom, Chris Clifford, Carl Ferenbach and Richard Lubin. Berkshire makes investments in consumer products, retailing and related services, business services, transportation, energy, industrial manufacturing and communications, and healthcare industries. Berkshre makes control or minority investments in the US, Canada and Europe in companies with enterprise values between $200M to $2B and revenues of more than $100M and EBITDA of more than $25M. Equity investments range between $50M to $500M. Berkshire has seven private equity funds and has generated excellent, consistent returns. IRR and ROI over the first six funds, on average, have been 34.4% and 2.0x to 3.0x ROI, respectively. Fund VII has not yet been realized. A Lion Cao principal has coinvested with Berkshire and invested in their funds.
Fortress Investment Group (Drawbridge Special Opportunities Fund, or “Drawbridge”)
Drawbridge Special Opportunities Fund was started by Peter Briger of Goldman Sachs when he bought into Fortress in 2002. Drawbridge focuses on investments in three areas: asset-backed loans, buying portfolios of asset-backed loans and corporate securities, and has generated consistent returns with very low volatility. Fortress Investment Group manages roughly $27BN across private equity funds (approx. 54% of assets) and hedge funds (approx, 46% of assets). The Drawbridge Special Opportunities Fund managed by Peter Briger has approximately $5BN of AUM. Fortress has offices in Charlotte, Chicago, Dallas, Frankfurt, London, Los Angeles, Munich, New Canaan, Rome, San Francisco, Shanghai, Sydney, Tokyo and Toronto. A Lion Cao principal was an initial investor in the Fund.
|
|