Private Equity

The Hershey Co. has forced out six directors and two others resigned, raising new concerns about the future of the venerable Pennsylvania company. The bold shake-up - which included adding two board members from private equity buyout firms - has sparked questions as to whether the company may again explore a sale. The Hershey Trust, which controls the majority of company stock and pushed for the board ousters, said that the changes were not about finding a buyer, but rather to secure the company's financial future.

Private equity firm looks likely to acquire Chrysler, paper says DETROIT - Cerberus Capital Management, a private equity firm that already has ties to the auto industry, emerged over the weekend as the frontrunner to buy the Chrysler Group, the Detroit Free Press has learned. If Cerberus is named the final bidder, which could happen as soon as today, it would be a spectacular triumph for a private equity firm to take control of one of Detroit's automakers and a giant blow to Canadian auto supplier Magna International Inc. It also could mark the beginning of an even more difficult time for organized labor, which has been vocal about its opposition to private equity firms getting involved in the auto business.

Although still flush with cash, equity markets are becoming a bit more demure with their investments over fears about interest rates and potential changes in tax rules for private-equity firms. And that's bad news for Trump Entertainment Resorts Inc., an underperforming company with lots of debt, as it tries to sell itself, according to Wall Street analysts. If that wasn't enough, there are three major leveraged buyouts involving the gambling industry: Harrah's Entertainment Inc., Penn National Gaming Inc., and Station Casinos Inc. All three are being bought by private-equity firms.

Also in this column: Are bankers too fearful? Blaming the SEC's new rules Stocks are down. Bonds are flat. So professional money managers have been turning to venture capital and foreign investments in their never-ending search for higher returns. That's according to a survey of 1,400 pension and endowment managers by Connecticut-based Greenwich Associates. During the bull market of the 1990s, America's corporate and private pension funds and university and foundation endowments put more than half their money in U.S. stocks.

Dow Chemical Co. said yesterday that it had fired a senior adviser and a high-level executive, accusing them of trying to negotiate a deal to sell the company behind management's back. The announcement came three days after Dow had said it was not in talks to be sold, despite news reports of a possible deal. J. Pedro Reinhard, a senior adviser, and Romeo Kreinberg, executive vice president of performance businesses, were dismissed with the approval early yesterday of the board of directors, Andrew Liveris, Dow's chairman and chief executive officer, said in a written statement.

State-subsidized pension funds for Pennsylvania state workers and teachers said last week that their 2007 investment returns were far in excess of U.S. stock and bond market indexes. The returns were so good that they left many investing professionals wondering how they could have been achieved in such an awful environment. The $76 billion Pennsylvania Public School Employees' Retirement System said it earned 13.8 percent for the year. The $35 billion State Employees Retirement System said it did even better, at 17.2 percent.

A Boston private-equity firm paid $60 million yesterday for a controlling stake in a Devon consulting company that has been thriving in the era of tougher, post-Enron accounting rules. Smart Business Advisory & Consulting L.L.C. will use the cash from Great Hill Partners L.L.C. - provided under a deal being announced this morning - to pick up its pace of growth by making acquisitions and adding new offices, while steering toward a public stock offering. Smart Business Advisory has been growing rapidly, but it has been held back by the scarcity of money to expand, chief executive officer James Smart said yesterday.

State-subsidized pension funds for Pennsylvania state workers and teachers said last week that their 2007 investment returns were far in excess of U.S. stock and bond market indexes. The returns were so good that they left many investing professionals wondering how they could have been achieved in such an awful environment. The $76 billion Pennsylvania Public School Employees' Retirement System said it earned 13.8 percent for the year. The $35 billion State Employees Retirement System said it did even better, at 17.2 percent.

TIANJIN, China - Three years ago, Gary Biehn, a partner with White & Williams in Philadelphia, wanted to expand his law firm's reach to this port city in northern China, an economic powerhouse that gets special attention from the country's central planners. The firm already had a business tie to a law firm in Shanghai and saw benefits to connecting with Chinese lawyers here. Biehn reached out to the International Visitors Council of Philadelphia, and a string of calls and connections that played out over the last year culminated in a business agreement signed here Monday under the eye of Mayor Nutter and his Tianjin counterpart, Huang Xingguo.

A $6.3 billion bid to put Aramark Corp., one of Philadelphia's biggest companies, in the hands of private investors led by chairman Joseph Neubauer has been approved by the company's directors. Aramark, which got its start in 1936 as a seller of peanuts, is now known for selling food in venues such as Citizens Bank Park and Lincoln Financial Field, and for operating hotels and restaurants in national parks. This marks the second time that the company, led by Neubauer since 1983, has moved to take itself off the stock market.