Speaker 1: Welcome to the Bloomberg p m L Podcast. I'm Pim Fox.
Speaker 1: Along with my co host Lisa Bramowitz. Each day we
Speaker 1: bring you the most important, noteworthy, and useful interviews for
Speaker 1: you and your money, whether you're at the grocery store
Speaker 1: or the trading floor. Find the Bloomberg p m L
Speaker 1: Podcast on Apple Podcasts, SoundCloud, and Bloomberg dot com. Facebook
Speaker 1: heady brief for previow yesterday, but shares are down nearly
Speaker 1: one percent again today after losing nearly fourteen percent uh
Speaker 1: IF their shares last week. Here to join us to
Speaker 1: talk a little bit about a behind the scenes look
Speaker 1: at how Facebook approached marketing and how they attracted certain
Speaker 1: shady advertisers is Robert Friedman, Senior editor on the Projects
Speaker 1: and Investigations team here at Bloomberg News. This is an
Speaker 1: amazing story. It's going to be in Business Week. It's
Speaker 1: written by Zeke Fox. I recommend everybody read it. Can
Speaker 1: you just give us a sense of where it begins
Speaker 1: this conference at why it's notable. Well, Zeke is on
Speaker 1: a well deserved vacation this week, UM, so I'm here
Speaker 1: to uh to speak for him. This story has been
Speaker 1: in the works for over a year. UM. And Zeke
Speaker 1: came to me last spring and said, I want to
Speaker 1: go to this conference in Berlin for affiliate marketers. And
Speaker 1: I said, what is that. I just want to go
Speaker 1: to Berlin and DC And then he said, and there's
Speaker 1: also an after party and abissa which I want to
Speaker 1: go to. And I said, Zeke, are you scamming me?
Speaker 1: And um. But the more he told me about this
Speaker 1: strange world of affiliate marketing, UM, I the more I
Speaker 1: got interested. So affiliate marketing is basically just a bunch
Speaker 1: of middleman who buy clicks and views from Facebook and
Speaker 1: sell them to people who try to sell stuff. A
Speaker 1: lot of it's legitimate. UM. Plenty of companies use this
Speaker 1: as an advertising tool. But UM, all the shady advertisers
Speaker 1: who sell uh stuff through you know, free iPhone offers
Speaker 1: or diet pills approved by Oprah Winfrey or Elon Musk's
Speaker 1: UM smart pills, UM, fake endorsements, UM, stuff that pops
Speaker 1: up and pollutes your your your Internet experience. UM. They
Speaker 1: all actually um take advantage of this affiliate marketing deal.
Speaker 1: And they all congregate around this conference, which is hosted
Speaker 1: by a suspiciously sounded group called Stack that money. So
Speaker 1: Zeke Z stack that mine. So Zeke went out there
Speaker 1: and the first thing he noticed was all the Facebook
Speaker 1: people that were there. They were on stage, they were
Speaker 1: moderating panels, they were out mingling with the with the crowds.
Speaker 1: And he said, what is going on here? And u
Speaker 1: uh And thus began an investigation into the strange relationship
Speaker 1: between these affiliate marketers and Facebook. Um. Facebook um, as
Speaker 1: you know, has built a very very powerful tool to
Speaker 1: a good people. Um and and based on all the
Speaker 1: data that you and I and everybody else gives them
Speaker 1: two point to billion people and the advertising community figured
Speaker 1: out pretty quickly that this was a valuable tool for
Speaker 1: them to let Facebook find the suckers for them. And
Speaker 1: that began this, uh, this adventure. Okay, So this sort
Speaker 1: of brings us to a fork in the metaphorical road
Speaker 1: here for Facebook, because on one hand, uh, they have
Speaker 1: said that they try to fare it out bad actors,
Speaker 1: people who are trying to sell miracle pills that don't
Speaker 1: work or iPhone iPhones that are free to end up
Speaker 1: charging you EIGHTI six dollars a month for the rest
Speaker 1: of your life. UM. I'm just wondering what they knew
Speaker 1: about the bad actors, what they did to stop them
Speaker 1: or is there evidence that they've been actively recruiting them.
Speaker 1: So Facebook has certain rules about things you're not supposed
Speaker 1: to advertise on on it, and they have reviewers who
Speaker 1: somewhere overseas or reviewing content and UH. For years they
Speaker 1: had a very small skeletal crew of three engineers they
Speaker 1: were set to sort of combat this UH you know,
Speaker 1: fraud on advertising fraud. But it was a half hearted effort.
Speaker 1: And at the same time their marketing people were attending
Speaker 1: conferences and UH and recruiting trying to sell these ads.
Speaker 1: It's hundreds of millions of dollars of advertising revenue. So
Speaker 1: they had they had at best a complicated, um bifurcated
Speaker 1: relationship with with this world, but they were looking the
Speaker 1: other way in in in my view, it's only recently
Speaker 1: in the last year that they're beginning to think this
Speaker 1: more seriously. They hired a new person to sort of
Speaker 1: come up with and they've they and lots more reviewers
Speaker 1: and they've done But the the the ad scammeras are
Speaker 1: smart and they have developed a program and that's in
Speaker 1: this story. UM a guy named Rob Grin who became
Speaker 1: sort of the king of these affiliate marketers developed a
Speaker 1: program that allows you to cloak your ads. Um cloaking
Speaker 1: means that when they can figure out when a Facebook
Speaker 1: reviewer is reviewing the ad, and when they and the
Speaker 1: Facebook reviewer clicks on the add they get an innocuous
Speaker 1: um landing page, but everybody else falls on a on
Speaker 1: on the actual uh scam add So so um, they
Speaker 1: were just much smarter than Facebook. Um was able to
Speaker 1: keep up with whatever efforts they were making. And um,
Speaker 1: uh yeah, so that's Are there any laws that were
Speaker 1: broken here? Because on one hand, you know, people are
Speaker 1: free to try to portray their objects, they're their their
Speaker 1: wears as as positive as possible, and that's not considered
Speaker 1: a clear violation. This is a clear violation of FTC
Speaker 1: rules about fraudulent advertising. Yeah, so who's liable here? So
Speaker 1: the FTC occasionally makes a case. They busted a ring
Speaker 1: that in San Diego that was selling you know, fraudulent
Speaker 1: diet pills and made they had made a undred and
Speaker 1: seventy nine million dollars off of their their scam. Um,
Speaker 1: but it's it's it's it's a half hearted effort on
Speaker 1: the regulatory agencies, half hearted effort on the part of
Speaker 1: the technology companies and a great opportunity for all these
Speaker 1: uh scamming marketers. This is an amazing story. I recommend
Speaker 1: everybody read it. The main character, Grant, who's sort of
Speaker 1: the king of these, uh, these sort of shady advertisers
Speaker 1: and the intermediaries of them, said that when he first
Speaker 1: realized how much money he could make, he almost felt
Speaker 1: ill with excitement, panic, he described, panics. Yeah, but was
Speaker 1: he minting money? And then you know, he tries to
Speaker 1: sort of pedal back and wonder whether he should do
Speaker 1: something better with his life. And then thanks better of that?
Speaker 1: And thanks? What am I a communist? Robert Friedman, thank
Speaker 1: you so much for being with me. And really I
Speaker 1: recommend people read the story. Robert Friedman, Senior editor of
Speaker 1: the Projects and Investigations team for Bloomberg News. The story
Speaker 1: how Facebook helps shady advertisers sell fake Ellen smart pills
Speaker 1: by Zeke Fox. There has been a lot of turnover
Speaker 1: in President Trump's cabinet. Mike Pompeo going to be elevated,
Speaker 1: leading President Trump to nominated Gina has Belt to replace
Speaker 1: Pompeo as c A c I A director here with us,
Speaker 1: Jack Divine founding partner and president of the ark And Group,
Speaker 1: also former acting director of the c i A and
Speaker 1: a very familiar person with Gina Haspell. Jack, Thanks so
Speaker 1: much for being here. So Gina has been a very
Speaker 1: controversial pick. A lot of people have said that she
Speaker 1: was in charge of torture programs, that she discarded evidence
Speaker 1: tied to video tapes. You want to be on record
Speaker 1: supporting her absolutely. I've known her for many, many years,
Speaker 1: and I think the first thing you think of is
Speaker 1: a professional and frankly, even though I've known I can't
Speaker 1: tell you whether she would vote Republican or Democrats. She's
Speaker 1: in that category of so many of us that don't
Speaker 1: carry our politics into place. But when you look at
Speaker 1: the the panorama today of who's available here, you have
Speaker 1: someone who's been at the top of the operational director
Speaker 1: and now the top of the agency and working apparently
Speaker 1: very well with the Trump administration. Downtown and the workforce
Speaker 1: is very high on her. I think she's been painted
Speaker 1: and as more of a as a symbol of something
Speaker 1: that is not a reality. I think the hearings are
Speaker 1: actually going to be very conducive to straightening this out.
Speaker 1: I mean, I think the confirmation process, while grueling one,
Speaker 1: I think when the facts are surface, it's going to
Speaker 1: be far less dramatic and we're understandable when they get down,
Speaker 1: as they are now getting down and asking specifics. I
Speaker 1: think she will show extremely well. And I also want
Speaker 1: want to forget the fact which I think is getting lost,
Speaker 1: how big a deal it is to have the first
Speaker 1: woman to actor of CIA. I watched it over forty years.
Speaker 1: It's really quite an amazing development. Why is that a
Speaker 1: big deal? Well, when when I first joined the agency
Speaker 1: many years ago, the workforce had on our training class
Speaker 1: fifty people too women, None of them went in operations. Today,
Speaker 1: half of the agency's operators are now women, holding key
Speaker 1: positions that are reflective of the time. Um, but they've
Speaker 1: never been at the very top of the service. In fact,
Speaker 1: she'll be the only the second person in the history
Speaker 1: of the agency that's been in the operational part that
Speaker 1: has made it all the way to become the director.
Speaker 1: The other was Stick Helmels back in the sixties. I
Speaker 1: think that mindset of being a careerist and having those
Speaker 1: operational background steeped in it and at the policy level
Speaker 1: is critical today when we're looking at what Russia is
Speaker 1: doing either meddling in elections and taking out people with
Speaker 1: nerve agents. I mean, we got a really tough wear world.
Speaker 1: We better have somebody in that job that understands that world.
Speaker 1: Want to pick up on the Russia point because we
Speaker 1: did see earlier this week President Trump ejected sixty Russian
Speaker 1: diplomats over the UK poisoning incident. That was more than
Speaker 1: people had expected. How did you interpret this? Well, I
Speaker 1: know the Russians will be living. I mean I have
Speaker 1: seen and seen folks P and GD we called, you know,
Speaker 1: persona non grata, you're thrown out. I mean people have kids,
Speaker 1: they have schools that they running agents, they're doing business
Speaker 1: at pack up out of there back home. It is
Speaker 1: a very disruptive thing. So the institutions and my bed
Speaker 1: I don't have the names in front of me, but
Speaker 1: you can bet there's a high number of the sixty
Speaker 1: that are intelligence oriented. So they are going to be
Speaker 1: losing capability. They're closing Seattle. It's a big it's a
Speaker 1: big deal and a big blow, and then it creates
Speaker 1: such a h an international development. The Russians will probably respond.
Speaker 1: So there's some toughening of the lines between the Western
Speaker 1: Allies and Russian and I don't think this is a
Speaker 1: good This is not going to play well for Putin
Speaker 1: over the long haul. So one theory was that President
Speaker 1: Trump took a harder than expected stance on Russia in
Speaker 1: order to sort of pledge allegiance to the Allies in
Speaker 1: return for some support as h he goes ahead with
Speaker 1: ripping up the Iran Deal. What do you make of
Speaker 1: that theory. I don't put a lot of stock in
Speaker 1: that theory. I mean, you know, Tip and Neil used
Speaker 1: to say politics is all local. I think President Trump
Speaker 1: was looking at the winds of war, if you will.
Speaker 1: And I think the American people are starting to get
Speaker 1: increasingly um agitated and concerned about Russian behavior and are
Speaker 1: going back to a mindset that's more closer to the
Speaker 1: to the Cold War, which I think is most unfortunate.
Speaker 1: But Putent seems to be determined to push this. And
Speaker 1: I must say my own estimate of of Putin he
Speaker 1: would have been flattered. I thought he was a great strategist.
Speaker 1: Now I have great doubts about that. I really, yes,
Speaker 1: I have. I have changed my views. And the Econdis
Speaker 1: magazine had him on the cover is a great chess player.
Speaker 1: I really, I'm not even sure he's a good checkers
Speaker 1: player whoa really interesting and other uh checkers or chess player.
Speaker 1: We're not sure Kim Jong un. And I'd love to
Speaker 1: get your opinion on the surprise visit to Beijing. What
Speaker 1: do you think that's about and is there any relationship
Speaker 1: between some of the tariff talk that we've heard between
Speaker 1: the US and China and this visit. Well, I think,
Speaker 1: first of all, I would say Kim is at least
Speaker 1: a good checkers player. I mean, they've they've been playing
Speaker 1: this game for a long time where they move their
Speaker 1: programs forward and then where they get to a plateau,
Speaker 1: they say, well, let's let's negotiate. So I'm for the negotiations.
Speaker 1: I've been urging it for a long time. You know,
Speaker 1: there's no real military option here, so you've got to
Speaker 1: get back to the table. Who comes to the able
Speaker 1: And as you point out, the Chinese are a major factor.
Speaker 1: I think they're less so than many people realize, in
Speaker 1: the sense that the Chinese had great influence for many
Speaker 1: many decades, were the last fifteen twenty years. It's less
Speaker 1: but more than anybody else, certainly, And they can be
Speaker 1: very helpful. I think the Chinese are are torn on
Speaker 1: this one, but I don't think they want to be
Speaker 1: left on the sideline. So I think that's what we're
Speaker 1: looking at here. Um, just taking a little bit of
Speaker 1: a step back home. I'd love to just get your impression.
Speaker 1: In some of the turnover that we've had in the
Speaker 1: White House cabinet with John Bolton becoming National Security Advisor,
Speaker 1: a lot of people were saying this brings us closer
Speaker 1: to having a war, with Ian Bremer saying that this
Speaker 1: was the single worst day for geopolitical risk in a
Speaker 1: long time. What's your take, Well, I think you know, again,
Speaker 1: there's been a number of changes, and this is very common.
Speaker 1: As you know new administrations. The end of the first year,
Speaker 1: there's usually significant trends, and normally they move more to
Speaker 1: the center. If there to the left, the move center left.
Speaker 1: If they're to the right, they move center right. And
Speaker 1: I think that's UM and the bureaucracies themselves and the
Speaker 1: civil servants begin to gain more and more influence, and consequently,
Speaker 1: when I look at Pompeo, the move of Pompeo, who
Speaker 1: has been a very successful director of CIA and and
Speaker 1: a confidant of the President, and I don't think they
Speaker 1: knew each other very well when it started. It's now
Speaker 1: going to be over a state. This is a good
Speaker 1: thing for the State Department. Gina. We talked about moving
Speaker 1: her up. You now have a team that knows Trump
Speaker 1: works with them, and I think they're pragnantists and realists.
Speaker 1: The Monkey, the Wrench, the person you have not mentioned
Speaker 1: and I we're just going to say the tricky one here,
Speaker 1: and I must tell you I'm sitting back and looking
Speaker 1: at it doesn't seem to fit. Is his Bolton, And
Speaker 1: I wish I knew him and could size it up
Speaker 1: face to face. But on the surface, my big concern
Speaker 1: with the administration early on, and it looked like the
Speaker 1: neo cons might be making a way back into the
Speaker 1: White House and that stopped. Yeah. Now I worry whether
Speaker 1: if Bolton sticks to his position, whether or not we're
Speaker 1: going to see a more oct We're gonna have to
Speaker 1: leave it there. Founding partner and president of the ark
Speaker 1: And Group, also former acting c I a chief. Another
Speaker 1: grocery store chained Southeastern Grocers Chapter four filed four Chapter
Speaker 1: eleven bankruptcy today in Delaware, Delaware, it is similar in
Speaker 1: some ways declare Stores and Toys r US in that
Speaker 1: it has a lot of debt linked to a two
Speaker 1: thousand and five buy out, and here to kind of
Speaker 1: draw the links together for us. As Jared Dillion, a
Speaker 1: columnist for Bloomberg View, Jared, thank you so much for
Speaker 1: being with us. He is also an editor and publisher
Speaker 1: of The Daily Dirt Nap. Jared, can you talk a
Speaker 1: little bit about how we should sort of view the
Speaker 1: growing volume of bankruptcies that we've seen with LVO financed
Speaker 1: or bought out companies UM like claires, like Toys r
Speaker 1: US now Southeastern Grocers. You know, I think I think
Speaker 1: that you know, it's just a small trickle at this point.
Speaker 1: But the alarming thing is is that, you know, we're
Speaker 1: really at the top of the expansion um and we're
Speaker 1: seeing some of these bankruptcies, and you know, usually that's
Speaker 1: not when you see bankruptcies like these. Now the retail
Speaker 1: environment has changed a lot for Claires and Toys r
Speaker 1: US and also for groceries, but you shouldn't be seeing
Speaker 1: these deals fall apart at the top of the cycle.
Speaker 1: So what do you make of that? Well, you know,
Speaker 1: I think if you look at some of these individual deals. Uh,
Speaker 1: it's just too much debt. And you know, in the
Speaker 1: case of Claire's, they had over two billion, and this
Speaker 1: is not it's not a big business, you know. Uh,
Speaker 1: two billion is a lot. I just I think from
Speaker 1: an outsider looking in, it just doesn't pass the common
Speaker 1: sense test. Uh, toys r Rust had fion going out
Speaker 1: the door every year and interest expense. I mean this
Speaker 1: is you know, it depends on what your philosophy of
Speaker 1: debt is. What a lot of people think that businesses
Speaker 1: should borrow as much as they possibly can without going
Speaker 1: bankrupt to maximize profits. So you're the the title of
Speaker 1: your column was private equity, it's more like pirate equity.
Speaker 1: And you seem to place the blame on private equity
Speaker 1: companies for basically forcing these companies to incur as much
Speaker 1: debt as they have. Of you know, a lot of
Speaker 1: people would say private equity companies have some misses, this
Speaker 1: is to be expected, but they need a lot more
Speaker 1: wins in order to deliver good profits. Explain where llain here.
Speaker 1: I think I think the issue here is really one
Speaker 1: of public opinion. I think that the private equity industry
Speaker 1: has to be careful. Um, you know, after the Toys
Speaker 1: r US deal, I saw some uh you know, left
Speaker 1: leaning stuff on social media just blaming the private equity
Speaker 1: companies for thirty three thousand job losses, which is not trivial.
Speaker 1: And if we have a recession, if we have you know,
Speaker 1: an honest to go to this downturn and we get
Speaker 1: more PD deals fall apart and more layoffs, it is
Speaker 1: going to point back directly at the private equity industry.
Speaker 1: Um So, really like the point of the piece was
Speaker 1: about how public opinion can turn on an industry very fast,
Speaker 1: and I think we're already seeing the beginnings of that.
Speaker 1: And and this sort of is analogous to what we
Speaker 1: saw with Wall Street after the two says an innate
Speaker 1: financial crash. I'm wondering what will be the implication if, say,
Speaker 1: there is a rash of private equity sponsored companies that
Speaker 1: do go bankrupt and that does do result in many
Speaker 1: job losses. What will be the consequences if public opinions hours?
Speaker 1: Is it more regulation? Well? I don't, I don't. I
Speaker 1: don't see how regulation would really uh benefit the situation.
Speaker 1: But I think that you know this, it's not just
Speaker 1: Wall Street, it's the academic community. It's the c f
Speaker 1: A program. It's it really is going to result in
Speaker 1: a see change about how people think about debt and
Speaker 1: how it should be used. Um, right now people are
Speaker 1: using it to maximize profits. In the future, they might
Speaker 1: try to minimize debt in order to maximize safety. You know,
Speaker 1: one of the people I mentioned in the piece was
Speaker 1: d Ramsey, And Dave Ramsey is a personal finance expert
Speaker 1: who has a following of millions of people, and he
Speaker 1: advocates at the consumer level to pay off your mortgage,
Speaker 1: to pay off your car loan, to pay off your
Speaker 1: credit card debts, and to live debt free. And it's
Speaker 1: the corporate sector that has leveraged up massively while consumers
Speaker 1: have de leveraged. I guess what I was trying to
Speaker 1: get at is for Wall Street, the consequences of souring
Speaker 1: public opinion were huge finds or more regulation and frankly
Speaker 1: a brain drain, with a certain number of people who
Speaker 1: would have otherwise gone to Wall Street going to say
Speaker 1: Silicon Valley. What will be the sort of analogous consequence
Speaker 1: for private equity. Well, you know, I think that, uh,
Speaker 1: you know, public opinion will turn against private equity much
Speaker 1: in the same way that it did in Wall Street.
Speaker 1: And it could result in a brain drain. It could
Speaker 1: you know, it could result in the government talking about
Speaker 1: some you know, reasonable limits that can be placed on debt.
Speaker 1: I really, you know, I can't speculate as to how
Speaker 1: it's going to turn out. I mean I think that, um,
Speaker 1: we're still probably a year or two away from this
Speaker 1: cycle playing out. Jared Dillion, Thank you so much for
Speaker 1: being with us. It's really an interesting column. Jared Dillion,
Speaker 1: columnist with Bloomberg View, also editor and publisher of The
Speaker 1: Daily Dirt Nap and investment strategist also at Malden Economics.
Speaker 1: Right now, I want to turn the attention to deals.
Speaker 1: There are a couple of big ones joining us now.
Speaker 1: Chris Hughes, deal's columnist for Bloomberg gad Fly. It's a
Speaker 1: commentary section for Bloomberg View in Bloomberg LP. Thank you
Speaker 1: so much for being with us, Chris. I want to
Speaker 1: thank your take. I want to start with the Glaxo
Speaker 1: Smith Klein and Novartists deal. It's a thirteen billion dollar
Speaker 1: deal to buy some consumer mere brands from Novartis. This
Speaker 1: is already a joint venture. Shares of both companies went up.
Speaker 1: How is this possible that it is so universally thought
Speaker 1: to be good for both of them? Well, I think
Speaker 1: um Black has really gone up today and the vats
Speaker 1: up a bit. Obviously the market helps. I mean for
Speaker 1: both sides, it gives them certainty. For a while they've
Speaker 1: been in this joint venture. Earlier this month, Novartis gained
Speaker 1: the right to sell its share of it to the
Speaker 1: blackso side everyone's been wondering, you know, when is that
Speaker 1: going to happen, on what price? And so we know
Speaker 1: it's happening now and we know the price. So there's
Speaker 1: I think relief all around that we know what the
Speaker 1: side of this is. From Blacks perspectives, there's a sort
Speaker 1: of double release because the market also knows that if
Speaker 1: they're doing this, they're going to be a bit more
Speaker 1: constrained from doing other big deals. And the one that
Speaker 1: everyone's been focusing on is the possible deal for Fizers
Speaker 1: consumer healthcare business that could have cost up to twenty billions.
Speaker 1: So I think blackst Shells in particular, thinking well, we
Speaker 1: know what they're doing here with the joint venture buy out.
Speaker 1: They're probably not going to go for Fiser in the
Speaker 1: short term. And I think that's what's what's pleasing Clacko
Speaker 1: shareholders today. So it's going to keep them from doing
Speaker 1: something stupid. Well in the short term, I mean, one
Speaker 1: would hope that shareholders are going to be on their
Speaker 1: toes here and keeping management from doing something stupid whatever.
Speaker 1: But UM, certainly in the short term this is this
Speaker 1: is this is sort of big deal for clacks so
Speaker 1: but further out they're probably going to be in quite
Speaker 1: a good space later in the year. They're also talking
Speaker 1: today about UM selling off some of the consumer brands
Speaker 1: within this within this business, so that's going to sort
Speaker 1: of shrink the deal a bit. And they're talking to
Speaker 1: about exiting but possibly exiting UM that they're Indian subsidiaries.
Speaker 1: That would raise some money too. So the strain of
Speaker 1: this is certainly being offset by some other other sales
Speaker 1: they're planning. Let's talk about the other deal of the day,
Speaker 1: at least from my perspective, the Axo Noble deal. It's
Speaker 1: selling its specialty chemicals unit to US private equity firm
Speaker 1: Carlisle Group for about twelve and a half billion dollars UM.
Speaker 1: So can you describe a little bit about what Axo
Speaker 1: Noble is and give us your take on whether this
Speaker 1: price is too high or too low. So about big
Speaker 1: European paints and chemicals company, It had an unslisted bid
Speaker 1: last year from PPG Industries of the state's very very
Speaker 1: bitter battle there which in the end saw PPG walk away. Now,
Speaker 1: this sale today of the specialty chemicals business for ten
Speaker 1: point one billion euros about UM to our thirteen billion
Speaker 1: dollars UM is actually part of really originates from that
Speaker 1: PPG bid. One of the key aspects of access defense
Speaker 1: against the PPG approach was that it was going to
Speaker 1: split itself into and finally here nearly a year on UM,
Speaker 1: we've got we've got that split taking place, with this
Speaker 1: business being sold to m to Carlisle and on the
Speaker 1: on the on the price, well, this is this is
Speaker 1: a price that has been achieved after a very long auction.
Speaker 1: Lots of private private ecty firms interested in this sort
Speaker 1: of asset. They love, you know, unloved assets from a
Speaker 1: big company. I did some maths on this so a
Speaker 1: few weeks ago it looks to me like a private
Speaker 1: exty owner at this price and probably double their money
Speaker 1: if they can sort of turbo charge the performances and
Speaker 1: if they can get some cost out and the revenue
Speaker 1: a bit three years time, they want to be able
Speaker 1: to double their money on this. And it caps a
Speaker 1: quarter of some pretty big buyouts. And I'm just wondering,
Speaker 1: are we expecting to see another big buyout quarter next?
Speaker 1: I wouldn't. I wouldn't be surprised. You know you've got
Speaker 1: you've got private with a lot of dry powder. We've
Speaker 1: seen some very ambitious deals union Leavers, spreads and in
Speaker 1: Europe we've seen a bid for for TDC from private
Speaker 1: equity and infrastructure investors. To know there's an appetites out
Speaker 1: there and if they can find it, in particular unloved
Speaker 1: assets and big corporates that are available, they're kind of
Speaker 1: go for them, and it's necessary, they'll team up to
Speaker 1: do it, as as Carlile's done here. Chris Hughes, thank
Speaker 1: you so much for being with us. Chris Hughes is
Speaker 1: a deals columnist for Bloomberg, Goadfly and Unloved or perhaps
Speaker 1: just not quite as loved. In this era of incredible
Speaker 1: amounts of cash sitting in the coffers of private equity
Speaker 1: firms and big investment companies looking for a place to go,
Speaker 1: Thanks for listening to the Bloomberg P and L podcast.
Speaker 1: You can subscribe and listen to interviews at Apple Podcasts, SoundCloud,
Speaker 1: or whatever podcast platform you prefer. I'm pim Fox. I'm
Speaker 1: on Twitter at pim Fox. I'm on Twitter at Lisa Abramo.
Speaker 1: It's one before the podcast. You can always catch us
Speaker 1: worldwide on Bloomberg Radio