Archive for the ‘Thayer Capital’ Category

2008: Forecasting The Hotel Industry And Private Equity Opportunities

Wednesday, January 2nd, 2008

The Washington Post business section has two stories I’m quoted in.

One is about the business side of hotels — a year-in-review and look ahead. Here’s an excerpt.

Now revenue per available room at Marriott and Host will probably grow 5 to 7 percent, according to the companies and analysts, as a weakening economy cools spending and growth. Marriott officials stress such gains would still beat inflation. …

“You will have an abatement of the really large increases, but you are still going to have increases, so that’s good,” said Fred Malek, the co-chairman of Thayer Lodging, which owns several Marriott hotels, including one in Annapolis.

The other article is about private equity and the credit crunch:

“The days of easy money — buying something with a lot of leverage and flipping it in 18 months — are over,” said Frederick Malek, founder of Thayer Capital, a private-equity firm in the District.

There is still good money to be made in private equity through purchases at more prudent values, more conservative leverage, and building market share and profits over time. This is the old fashioned way that we have always embraced and is bases on the time proven premise that if you can improve a company’s performance, you can earn a good return.

Both articles are worth the whole read.  And here’s the photo the Post ran:

Fred Malek Thayer Washington Post

Thoughts On Sallie Mae Buyout Collapse

Thursday, September 27th, 2007

One of the credit crunch’s victims is the huge Sallie Mae proposed buyout.

The Washington Post covers it extensively today – and includes my thoughts on what’s happening.

“One of the largest private takeovers in history — the $25.3 billion buyout for college loan giant Sallie Mae — unraveled yesterday after its buyers balked at the price, citing turmoil in the credit markets and federal legislation to cut subsidies to student lenders.

The buyers, headed by fund manager J.C. Flowers, left open the possibility of acquiring Sallie Mae at a lower price. Sallie Mae vowed, however, that it would fight to keep the deal intact ‘to the fullest extent permitted by law.’  …

‘Several deals have collapsed under their own weight. There will be more,’ said Frederic V. Malek, chairman of Thayer Capital, a private-equity firm in the District.”

Indeed. I’ll be curious to watch as the trend continues. My further sense however is that does not signal the end of the buyout boom.  We in private equity will just need to be more conservative in our pricing and leverage and earn returns the old fashioned way of growing revenues and profits.