LYCOS RETRIEVER 
Henry Kravis: Companies
built 257 days ago
Kravis gave an interesting glimpse in what happens once deals get done, and it's all in the 100-day plan. That goes into effect the day the deal closes. It's a detailed operational plan drawn up and executed with the help of management. Gone, Kravis says, are the days of showing up at a company with a briefcase full of money -- because there were probably five other guys who brought a briefcase of cash before you. A successful deal is all about extracting value through improving operations.
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Kravis and Roberts have been through rocky times. Starting in the late '90s, KKR stumbled as a string of its companies began to fail, most notably Knoxville, Tennessee-based Regal Cinemas Inc., which filed for Chapter 11 in 2001.
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Behind all of the dealmaking, Kravis and Roberts... 63, now lord over an industrial empire that dwarfs some of the world's mightiest public corporations. As of May 31, the firm had a hand in 36 companies that together generated about $107 billion of revenue in 2006, according to figures KKR posted on its website. That's more than Coca-Cola Co., Microsoft Corp. and Walt Disney Co. put together.
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Roberts' comments come less than three months after Kravis hailed a "golden age" for leveraged buyouts as chief executive officers were willing to take their companies private and buyout firms had easy access to financing. Since then, firms like KKR have found it harder to entice investors to buy the loans and high-yield bonds they use to fund their takeovers as losses from U.S. subprime mortgages roil corporate bonds and loans.
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Perhaps lost amid the wine-soaked chuckles at the American Museum of Natural History last week was the impact of Kravis' actions on the hardworking people whose retirement money has made Kravis a legend. A quick primer: Kravis gets pension money for a KKR fund that buys companies. The companies he buys can deduct interest on the debt they take on as part of the leveraged buyouts, reducing state and federal tax revenues. Ironic, considering that the less money that comes into state, local and federal governments, the fewer public employees there can be, and the fewer people to pay into the public pension funds that have made Mr. Kravis rich. Not to mention the budget hit that vital public services take when state and federal revenues are down.
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Now, the activists are at it again, and Kravis is in their crosshairs. According to the film company, the gathering on Thursday will feature folks wearing sandwich boards with embedded TVs showing “A Home for the Holidays.”
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