Lone Star Funds is a worldwide private equity firm based in Dallas, Texas, that specializes in purchasing distressed companies and assets, often well-known consumer brands that have seen better times[citation needed] or gone through financial difficulties due to leveraged buy-outs.[citation needed] It also purchases under-performing and non-performing loans from banks; recently,[when?] the company has been active in Germany in purchasing such loans.[2]
Lone Star has affiliate offices in London, Tokyo, Dublin, Brussels, Luxembourg, and Frankfurt. Its general partner is a Bermuda-based entity headquartered in Hamilton .
John Grayken is the company's founder and chairman.
[edit] Holdings
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- Tokyo Star Bank, acquired 2001
- Korea Exchange Bank, acquired 2003 and sold in 2012
- B-Line, LLC, acquired 2006; Lone Star acquired from the founder and another private equity firm.
- Lone Star Steakhouse, acquired in December 2006.[citation needed][3]
- BI-LO, acquired in 2004 from Royal Ahold [4], filed for bankruptcy protection in March 2009.
- Shoney's Restaurants, acquired in 2002 and sold to a similar investment firm on January 1, 2007
- Sullivan's Steakhouse
- Del Frisco's Steak House
- Texas Land & Cattle Steak House
- Allgemeine Hypothekenbank Rheinboden AG (AHBR) of Frankfurt (Germany) acquired from the German trade union federation in 2005 and since renamed Corealcredit
- Solare Hotels and Resorts of Japan. Lone Star purchased the company from the bankrupt Chisun Company in 2002. In November 2007, Lone Star announced they would sell Solare..
- Kukdong Engineering & Construction Co., Ltd., acquired in June 2007.
- STARLease Co., Ltd., acquired in June 2007.
- IKB Deutsche Industriebank, acquired in September 2008 [5]
- Accredited Home Lenders Holding Co.[6], acquired in October 2007. Filed for bankruptcy protection in May 2009.
- Collateralized Debt Obligations from Merrill Lynch, acquired July 2008, paid 22% of face value for these CDOs, or $6.7 billion for assets with a face value of $30.6 billion.[7]
- On July 1, 2008, CIT Group announced that it will be selling its home lending division to Lone Star Funds for $1.5 billion in cash including the assumption of $4.4 billion in debt.
[edit] Tokyo Star Bank
Lone Star gained profit by collecting non-performing loans handed over from the former Tokyo Sowa Bank (now Tokyo Star Bank), which collapsed in 1999 and was then granted 760 billion yen from the Japanese government. However, the profit was transferred to a fund based in Bermuda via an Irish corporation, allegedly a shell, which barred the Japanese government from directly collecting taxes.
The company did not report the profit, but the Tokyo Regional Taxation Bureau recognized the case, corrected Lone Star's books by about 14 billion yen for years 2002 and 2003, and adjusted the company's corporate tax by 5 billion yen, including additional tax. However, the company has not yet paid the tax and, because it owns no domestic assets, the government has not yet been able to seize its property.[8][9]
[edit] References
- ^ "Fund Summary". http://www.lonestarfunds.com/En/lonestarfunds_summary.htm.
- ^ Lone Star Germany: Ravenous For Bad Debt - Workout veteran Lone Star is thriving by buying up Germany's troubled loans, Business Week, March 14, 2005
- ^ (Note: The name similarity between the investment firm and the restaurant chain is coincidental; the companies had no relationship prior to the purchase.)
- ^ Ahold completes sale of BI-LO and Bruno's to Lone Star, Ahold press release, dated January 31, 2005
- ^ "Lone Star to buy IKB, the German subprime casualty", New York Times 21 August 2008, http://www.nytimes.com/2008/08/21/business/worldbusiness/21iht-21ikb.15493131.html
- ^ www.accredhome.com
- ^ Craig, Susanne; Smith, Randall; Ng, Serena (2008-07-29). "Merrill Aims to Raise Billions More". Wall Street Journal. http://online.wsj.com/article/SB121728170968391097.html?mod=hpp_us_whats_news. Retrieved 2008-07-29.
- ^ "Lone Star group firm allegedly hid ¥14 billion". Kyodo News. 2008-04-01. http://search.japantimes.co.jp/cgi-bin/nn20080401a6.html. Retrieved 2008-05-03.
- ^ "ローンスター、東京国税局から約140億円の申告漏れの指摘" (in Japanese). Reuters. 2008-03-31. http://jp.reuters.com/article/topNews/idJPJAPAN-31083620080331. Retrieved 2008-05-03.
[edit] External links
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