Humble Pie...Again?

Today's menu included a big piece of humble pie for me. After the total domination of my classmates yesterday, Pat staged a comeback today that could only be classified as a beat down on the Hillendale Golf Course. I dropped eight strokes on the back nine (we played the back nine first) and came back to only drop one stroke on the front nine. It was a little embarrassing.

This reminded me of the new KKR public offering (work with me, here). For the second time in two years. The first time was last year during the credit crunch and the planned was scuttled. Now they are offering a second IPO. I applaud them for their courage at this time. The story is they are raising money to absorb the Dutch vehicle (KPE) which invests mainly in KKR buyouts. Appartenly, the shares have tanked as of late.

Henry Kravis and George Roberts are two of the most courageous men to work in private equity. These are the guys that took RJR Nabisco private and inspired the book "Barbarians at the Gate." I am not buying the reason that KPE assests are undervalued and they want to restructure in order to buy KPE. These gentlemen plan for the long term and I believe that is what this is about. Taking KKR public could ensure its longevity and move it away from its entrepreneurial roots.

While the spirit may not die when it goes public, I believe that Messrs Kravis and Roberts are looking for a way out. They are both near retirement age and probably looking to spend their time taking advantage of the fruits of their labor. Unfortunately, with the retirement of Mr. Kravis we may see another example of a company not being able to continue without its founder. Look at Schwab when Charles Schwab retired, for a year. He eventually came back and fixed everything. As of late he bought another company with the idea of finding his successor, spent three years grooming his successor and announced his retirement, again. My concern is that KKR may lose its way without the men that made the company what it is. I am not a huge fan of all founders, Jerry Yang should have sold out. Many founders hang on too long and stifle the spirit or the growth of a company. Messrs Kravis and Roberts don't belong in that group.

They are smart enough to pick a time when the market will give them what they deserve plus a premium. Then again, they may be joining me for a piece of humble pie.