Moparman said:
What does an investment company know about a trucking company?..Answer.Nothing!It's just a tax shelter for them.Their going to milk it dry and then what's left of it they will right off as a loss!Sad but true, this is the begining of the end for Jevic.Another good company down the pooper!
Do you have a CLUE how private equity (aka venture capital) works? I doubt it. Here it is in a nutshell.
A group of people/companies with money is put together. These are investors. They may be high net worth individuals, they may be pension plans or they may be companies with investment money. We'll call that the "S'Pot of Money". The VC firm collects all these investors into this pot, which is called a "Fund". They then go out and find things to invest this money in. Each VC firm will have different criteria. Each will invest only in some industries. Some VC firms don't do transportation. Some like only technology. Some only invest in start ups, some are mezzanine investors, some like managment buyouts, but each one has their likes and dislikes.
Once a VC invests in a company, their ONLY goal is to turn a profit. There are three ways to do this. 1. Sell off the assets if the assets are worth more than they paid. In Jevic's case, probably not much chance of this. 2. Make the company more profitable and sell it off to another private company or arrange for it to become employee owner or bought by the management in place. 3. Take the company public.
S'pots of money are not the least bit interested in losing their investment or only making a pittance. They are invested in the long run usually. And the investors have people they have to answer to. If the funds under management include pensions and retirement plans, they have oversight committees and regulators to answer to.
If you've read between the lines, Sun Capital isn't the lead investor here, a subsidiary of Sun Capital is. I've been trying to discover who that is, because that will make a difference. Subsidiaries exist for different reasons.
What that means is that a consortium of investors could have been formed JUST to purchase Jevic. That would be different than being in a fund with Sun Capital.
Time will tell.