The Carlyle Group paid $115 million to settle a collusion case Friday, less than a week before it was due for a major hearing on the lawsuit in Boston.
District-based Carlyle was the last of several private equity firms to settle the seven-year-old case. Plaintiffs had alleged that Carlyle and the other firms had colluded, mostly through e-mail, not to bid against one another on takeover targets during the mid-2000s.
Carlyle declined to comment, and a person close to the negotiations said Carlyle settled the case without admitting any wrongdoing on its part.
Six private equity defendants had already agreed to pay $475 million to settle the collusion lawsuit. A group of plaintiffs, suing in federal court, accused Carlyle, Blackstone Group, TPG Capital, KKR and others of agreeing among themselves not to bid against one another in eight corporate takeovers that included theater chain AMC Entertainment, food service firm Aramark and casino operator Harrah’s Entertainment.
As the lone holdout, Carlyle had taken a high-risk, high-reward strategy. Carlyle faced a legal technicality, known in class action suits as “joint and several,” which makes the remaining single defendant liable for all the damages incurred by the alleged conspirators.
In this case, Carlyle would have been on the hook for $10 billion, which under law can be tripled to $30 billion — or three times the value of Carlyle’s entire firm.
— Thomas Heath
● Nearly 8,000 cases of Kraft American Singles are being recalled because a supplier did not store an ingredient properly, Kraft Foods Group said. Kraft said it issued the voluntary recall because the improper storage temperature could lead to spoilage or food-borne illness. It did not specify the ingredient that was improperly stored. No illnesses have been reported. The recall includes products with “Best When Used By” dates of Feb. 20, 2015, and Feb. 21, 2015. The recalled singles were sold in 12-, 16- and 64-ounce packages.
● American Airlines and Orbitz Worldwide cut a deal that puts the airline’s fares and schedules back on Orbitz-owned Web sites after being missing for four days. American said Tuesday that it had withdrawn its fares from Orbitz-owned Web sites, including flagship Orbitz.com, because the airline could not come to an agreement with the online travel agency on a new contract. On Friday, however, American announced it had signed a “letter of intent” with Orbitz to come to a deal, and its fares were back on Orbitz by Friday afternoon.
● The executive board of the International Monetary Fund expressed confidence in Managing Director Christine Lagarde after receiving a briefing on a French corruption probe in which she is being investigated. In a brief statement, the 24-member board said it continues to have “confidence in the managing director’s ability to effectively carry out her duties.” Lagarde called the investigation “without basis” after answering questions before magistrates in Paris on Wednesday. She and her former chief of staff are facing questions about their role in an arbitration ruling that handed $531 million to French businessman Bernard Tapie.
— From news services
● Monday: All markets will be closed on Labor Day.