Lone Star Funds

Infobox_Company
company_name = Lone Star Funds
company_
company_type = Limited partnerships
foundation = 1995
key_people = John Grayken, Founder & Chairman
location =
industry = Private Equity
products = Investments, private equity funds
assets = $13.3 billion [cite web |url=http://www.lonestarfunds.com/En/introduction.htm |title=Lone Star Funds : Introduction |retrieved=2008-09-26]
homepage = [http://www.lonestarfunds.com www.lonestarfunds.com]
num_employees =

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 or gone through financial difficuties due to leveraged buy-outs. It also purchases underperforming and non-performing loans from banks; recently, the company has been active in Germany in purchasing such loans. [ [http://www.businessweek.com/magazine/content/05_11/b3924147_mz035.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]

Lone Star has affiliate offices in London, Tokyo, Seoul, Taipei, Dublin, Brussels, Luxembourg, and Frankfurt. Its general partner is a Bermuda-based entity headquartered in Hamilton .

John Grayken along with Ellis Short are the company founders and chairmen.

Holdings

* Tokyo Star Bank, acquired 2001
* Korea Exchange Bank, acquired 2003; Lone Star was attempting to sell it to Kookmin Bank, but is facing criminal investigations from South Korean regulators for stock manipulation, among other charges. [cite news | date=2008-02-01 | url=http://news.bbc.co.uk/1/hi/business/7221510.stm | title=Korea jails Lone Star executive | work=BBC News | accessdate=2008-02-02] It is now negotiating a deal with HSBC.Fact|date=September 2008
* B-Line, LLC, acquired 2006; Lone Star acquired from the founder and another private equity firm.
* Lone Star Steakhouse, acquired in 2006.Fact|date=September 2008 [(Note: The name similarity between the investment firm and the restaurant chain is coincidental; the companies had no relationship prior to the purchase.)]
* BI-LO, acquired in 2004 from Royal Ahold [http://www.ahold.com/page/585.aspx Ahold completes sale of BI-LO and Bruno's to Lone Star] , Ahold press release, dated January 31, 2005] , currently up for sale.
* Bruno's Supermarkets, acquired in 2004 from Royal Ahold.
* Shoney's Restaurants, acquired in 2002 and sold to a similar investment firm on January 1, 2007
* 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 bankrup Chisun Company in 2002. In November 2007, Lone Star announced they would sell Solare.
* Del Frisco's Restaurant Group, spun off from Lone Star Steakhouse in October 2007.
* Kukdong Engineering & Construction Co., Ltd., acquired in June 2007.
* STARLease Co., Ltd., acquired in June 2007.
* Accredited Home Lenders Holding Co. [ [http://www.accredhome.com/ www.accredhome.com] ] , acquired in October 2007.
* 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. [cite news | date=2008-07-29 | url=http://online.wsj.com/article/SB121728170968391097.html?mod=hpp_us_whats_news | title=Merrill Aims to Raise Billions More | work=Wall Street Journal | accessdate=2008-07-29]
* 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 in addition to the $4.4 billion in debt the company currently holds.

Alleged tax-evasion in Japan

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. [cite news
url=http://search.japantimes.co.jp/cgi-bin/nn20080401a6.html
title=Lone Star group firm allegedly hid ¥14 billion
publisher=Kyodo News |date=2008-04-01 |retrieved=2008-05-03] [cite news
language=Japanese
url=http://jp.reuters.com/article/topNews/idJPJAPAN-31083620080331
title=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
publisher=Reuters |date=2008-03-31 |retrieved=2008-05-03]

References

External links

* [http://www.lonestarfunds.com Lone Star Funds official web site]
* [http://www.blinellc.com B-Line, LLC web site]
* [http://www.corealcredit.de/ Corealcredit official web site]