http://www.zerohedge.com/news/2016-02-08/timmy-geithner-gets-loan-jamie-dimon-pe-investment
Tom is referring to Tim Geithner who just secured a line of credit with JP Morgan to invest in a $12 billion private equity fund launched by Warburg Pincus, the former Treasury Secretary’s current employer.
As Bloomberg reminds us, “when raising a new fund, private-equity principals and their firms often commit their own money, in part to encourage outside investors to sign up.” In other words, “you can trust that this is a good idea because look, I threw my own money at it.”
Bloomberg goes on to note that contributions from PE principals amount to around four-and-a-half percent of the capital the funds raised in 2014. That’s nearly double the figure from 2011.
For this particular fund, Warburg Pincus put up 6.7% of the $12 billion in commitments. Geithner is president at the firm, which puts him just under Joseph Landy and Charles Kaye who are co-CEOs. Warburg manages some $40 billion invested in VC assets and plain vanilla buyouts.
Apparently, Geithner’s net worth of $3.2 million wasn’t sufficient when it came to chipping in on the firm's latest fund, so he reached out to an old friend.
“While at the New York Fed, Geithner recruited a number of finance executives to join the board of directors of the reserve bank, arguing it needed to better reflect the composition of the financial system,” Bloomberg goes on to note. Among his recruits was Jamie Dimon, who in June 2009 at a conference announcing the repayment of $25 billion in TARP loans (i.e. your tax dollars),
Comments