This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

BankUnited Deal May Signal New PE Push

"Is that something they can live with, given that historically when they have done well, they have done tremendously well in a short period of time?" asks Varaiya.

Furthermore, many private equity funds are set up to have a profitable exit strategy within five years or less. If the recession drags on for several years and profitability is hindered, acquisitions that seemed like bargains may turn out to be busts.

Several recent bets that soured have made PE firms even more wary about their investments. Flowers has seen major investments plummet in Hypo Real Estate Holding AG and Japanese banks. Chrysler's potential bankruptcy poses huge risk to Cerberus. Texas Pacific Group lost $1.35 billion on its $7 billion investment in WaMu last year.

"Nobody else wants to see that happen," says Mix. "They want to have clarity before they pull the trigger."

Given the headwinds facing PE players, on the regulatory end as well as the valuation end, Mix says that most are sitting on the sidelines, acquiring very small banks to register for approval as a bank holding company. Flowers did this by purchasing First National Bank last year, and Wilbur Ross, the king of distressed investments who heads WL Ross, did this by taking over First Bank and Trust Co. earlier this year.

If opportunities emerge down the line, great. If not, PE firms will seek other avenues with fewer complications and less regulatory scrutiny.

Says Kaplan: "Private equity is very private."

Philip van Doorn contributed to this report.

RealMoney Barometer Poll
1 What would best describe your stance heading into the coming week of trading?
2 Which of these sectors do you think is set to move up in the coming week?
3 Which of these sectors do you think is set to move down in the coming week?

View the results without voting
5 of 5

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
BX $26.59 -1.66%
FBC $23.34 -0.77%
GS $160.07 -1.88%
JPM $61.57 -1.58%
TD $43.30 -1.50%


Chart of I:DJI
DOW 17,651.26 -99.65 -0.56%
S&P 500 2,051.12 -12.25 -0.59%
NASDAQ 4,725.6390 -37.5850 -0.79%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs