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...“The big thing that happened then was RJR Nabisco,” Jonsson said in an interview with the Financial Times, referring to the era-defining takeover by US private equity giant KKR immortalised in the book Barbarians...
...Few deals were more aggressive than KKR-Nabisco. But the most famous buyout in history soon became the most infamous....
...The signature transaction in this innovative wave was KKR’s hyper-hostile, successful $30bn bid for food and tobacco conglomerate RJR Nabisco....
...Most prominently, these included a losing role in the fight for control of RJR Nabisco, which became the backdrop for the popular book Barbarians at the Gate....
...The strategies of private equity houses have moved on from the Nabisco days when buyout groups were synonymous with asset stripping....
...KKR wants to be more like Berkshire US private equity giant KKR is famed on Wall Street for stalking corporate targets from RJR Nabisco to Alliance Boots and US Foods....
...Rates in the long run When I started in financial journalism, the 1987 stock market crash and the 1988 battle between KKR and RJR Nabisco were both closer in the collective market memory than the 2008 financial...
...Ever since Barbarians at the Gate, the iconic book about the RJR Nabisco LBO in the 1980s, the terms “junk bonds” and “LBO” have gone hand in hand....
...So in the early days of PE, going back even to like the ’80s and Barbarians at the Gate and the Nabisco buyout....
...else we’re reading How corporate raiders became teams of rivals The private equity industry was founded by mercenary dealmakers who bludgeoned opponents to win control of large corporations such as RJR Nabisco...
...They started in the 1980s with the $25bn conquest of RJR Nabisco, the giant conglomerate that made everything from Ritz crackers to Camel Cigarettes....
...Drexel financed small teams of dealmakers targeting corporate giants such as Disney, Texaco and then RJR Nabisco, the signature LBO of the go-go 1980s....
...Once RJR Nabisco’s finances became distressed, an interest rate that would bring the bonds to par would bankrupt the company....
...Throughout the 1980s, Marks began investing in many high-yield bond issues, which were unleashed in the name of leveraged buyouts (RJR Nabisco) and empire building (Wynn Resorts)....
...Vandevelde claims that the RJR Nabisco takeover eliminated “fat” in management because it shut down a $12m aeroplane hangar with half a dozen jets for RJR Nabisco executives....
...“What’s going on with Kellogg and Nabisco is also part of what’s going on with the labour shortage,” Simon said....
...In 1989, KKR acquired tobacco-and-biscuit-specialist RJR Nabisco for $25bn, making it the largest leveraged buy-out in history....
...Elsewhere, workers at farming equipment maker John Deere received a 10 per cent raise after a 5-week strike in November and workers at snack maker Nabisco secured a day off each week when their strike ended...
...Long after it eclipsed RJR Nabisco, KKR still does not own any private jets for the use of its executives....
...Elon Musk shoots the $44bn bird Last week the world’s richest man took to Twitter to warn that “the Barbarians are at the gate”, alluding to the 1989 tale of KKR’s takeover of RJR Nabisco for $25bn....
...But KKR’s $25bn conquest of RJR Nabisco in 1989, immortalised in the book Barbarians at the Gate, would come to symbolise a new kind of scorched-earth finance that created billionaires but left carnage among...
...True, the private equity model undoubtedly imposes discipline on executives and eliminates much of the ego-driven decision making that led to the demise of RJR Nabisco and its peers....
...A weeks-long strike by Nabisco across five states ended with a contract that guaranteed workers a day off each week. But the list of success stories is shorter than that of strikes in progress....
...“Never play by the rules,” the former RJR Nabisco chief executive once insisted. “Never pay in cash. And never tell the truth.”...
...The pair were memorialised in the 1989 book Barbarians at the Gate, which recounted KKR’s conquest for the conglomerate RJR Nabisco....
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