Earlier today, Gawker's John Cook dumped nearly 1,000 pages of "internal audits, financial statements, and private investor letters for 21 cryptically named entities in which Romney had invested" for all of the Internet's viewing and dissecting pleasure. It's quite a lot to digest and he's looking for help digging through all of it but it's pretty unlikely that there's anything nefarious in all these documents (Fortune's Dan Primack has basically already Tweeted as much and Business Insider's Joe Weisenthal isn't that impressed either). So, no, these won't take Romney down like Nixon but there may be interesting tidbits here and there.
For many of you (including yours truly) that have provided exemplary professional services to alternative investment clients in the past (or doing so as we speak), these documents will look very familiar. It's run-of-the-mill stuff for the most part – balance sheets, income statements, partners' capital, cash flows, schedules of investments, and notes that accompany all those things.
We'll just mention a few things that we found:
Most firms similar to Bain like to stick with one accounting shop for their audit services and it looks like Bain's choice is Papa Whiskey Tango because PwC is all over these documents. They were the auditors for all the Bain and Sankaty funds that were dumped. They were also the auditors for Absolute Return Capital Partners and Prospect Harbor Credit Partners and Viking Global Equities (a holding of Goldman Sachs funds of funds). Ernst & Young is the auditor of the Taconic funds and Karsch Capital II, Ltd. (both are also held by GS fof) whose financials were dumped, so there is a twist of Black & Yellow in there.
As for the investments these funds made, here are just a few notable ones (all as of December 31, 2009):
Bain Capital Fund VII, L.P. held positions in Burger King and Warner Music Group. In other words, the type of food that is culpable in the nation's rising obesity rate and and the music label that brought you Nickelback.!
Bain Capital Fund VIII, L.P. had some interesting holdings as well, including Burlington Coat Factory (a hipster's paradiesparadise), Dollorama (Canada's Dollar Store), and Dunkin' Brands (again, helping us get fat, but the coffee is pretty great).
The rest of the funds have a variety of investments – partnership interests, international equities, bonds, notes, etc. – and they also utilize various derivatives, master-feeder structures, and coinvestment funds as well. Pretty typical stuff for the private equity world.
So, as we said, not much to write home about, but if you like, take a gander at the Bain Files and let us know if you see anything else semi-interesting. And, of course, if you worked on any of these entities, particularly the Bain funds or Romney's tax returns, we'd love to hear from you.
