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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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From: UncleBigs	6/30/2006 8:44:23 PM
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Blackstone group to buyout Michaels Crafts for $6 billion: biz.yahoo.com I don't know what these people are thinking. Paying top dollar at the peak of the retail cycle for a purveyor of wicker baskets and trinkets seems ludicrous to me. This is over 11 times ebitda for a highly cyclical company with over 900 stores (not likely a huge growth opportunity in terms of geographic expansion). These buyout firms either aren't thinking straight or only care about the management/financing fees they plan to extract for themselves and don't care about their investor's returns. What could possibly be the exit strategy for this? Take it public again? They will be sitting on this one for a long time.

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