Brisbane Bullets to get a bullet? Fresh from presiding over a disastrous foray into the United States, ABC Learning Centres boss, Eddie Groves’ beloved Brisbane Bullets basketball team appear close to collapse. AAP reported yesterday that “the club’s white knight, Brisbane businessman David Kemp, has notified recently appointed general manager Brian Kerle that the sponsorship promised in a rescue takeover of Eddy Grove’s NBL license is no longer available.” The Kemp-led consortium was set to purchase the Brisbane Bullets from Groves, but were not satisfied after completing due diligence, with Kemp claiming that the Bullets were “one hell of a mess”. Unless a new buyer can be found, it is likely that the Bullets won’t be lining up when the new NBL season commences in September. A foundation NBL club, Brisbane, like ABC Learning Centers, achieved a degree of success under Groves’ ownership, winning the 2007 NBL championship. Famously, after the victory, Groves flew the entire team to Las Vegas to celebrate. It is unlikely Groves will be much help to Brisbane now though — his wealth has been virtually erased after his stake in ABC Learning Centers, once worth $295 million, has dwindled to only $4,364. — Adam Schwab

Private equity boom goes BOOM! You wouldn’t have read about it eighteen months ago, but it appears that the much hyped “private equity” boom has officially bust, or is at least rapidly deflating. With the cost of credit skyrocketing, private equity buyouts have become increasingly difficult to complete. Earlier this month, the anomalous publicly listed private equity firm, Blackstone Group, announced a US$250 million loss for the quarter ending 31 March 2008 and has seen its share price drop from US$38 in June 2007 to close at US$18.92 yesterday. Even worse, the private equity holding company of housewares retailer, Linen ‘n Things, filed for Chapter 11 bankruptcy protection on 2 May 2008. Linen ‘n Things was taken private by Apollo Management LP in November 2005 for US$1.3 billion. Apollo is run by a fellow by the name of Leon Black. Before founding Apollo, Black spent fourteen years at Michael Milken’s defunct investment bank Drexel Burnham Lambert. Black was head of M&A at Drexel’s prior to it declaring bankruptcy in 1990. Black can afford the odd failure – he is estimated to be worth upwards of US$4 billion. The private equity collapse shouldn’t come as a surprise to Crikey readers, with this column suggesting way back in November 2006 (well before the credit crunch) that: “The one thing that equity markets have taught us over hundreds of years is that investors have very short memories. From Tulipmania to the South Sea Bubble, Roaring Twenties to the Nifty Fifty in the late 1960s, and most recently the dot.com boom, investors have been prone to forgetfulness as they were driven by uninhibited greed.” But spare a thought for the hidden losers out of the private equity bust – that is, New York’s oft-forgotten party planners, who will be quivering at the thought of Blackstone boss, Steven Schwarzman, downsizing his 62nd birthday party. Schwazman’s infamous 60th birthday bash reportedly cost the mogul more than US$3 million and featured the dulcet tones of Rod Stewart. — Adam Schwab

Consumers suffering because European governments increased spending. The biggest laugh I had all week was from Bloomberg.com reporting that “European consumers are ‘suffering as surging food and energy prices erode the value of their wages’, finance officials said” which is not itself funny, but the article immediately goes on that this is “urging governments to boost spending to help the poorest deal with the fastest inflation in 16 years.” Hahahaha! Consumers are suffering because the stupid European governments boosted spending for a decade or more, the money financed by debt, and it is all of this spending that has made the purchasing power of the euro to fall. And now the governments are going to boost spending some more Hahaha! But it’s okay, these guys are saying, because it’s “to help the poorest deal with the fastest inflation in 16 years.” Hahahaha! Idiots! As Strother Martin said of Butch Cassidy and the Sundance Kid in the movie of the same name as they went down the mountain to La Paz, “Idiots! I’ve got idiots on my team!” — Mogamb0 Guru, The Daily Reckoning

Growth outlook bleak. The latest sign of what is shaping up to be the “difficult year for consumers” economic growth expectations are at a four-year low. The Westpac-Melbourne Institute leading index of economic activity, a measure the annualised growth rate looking three to nine months ahead, was 3.3% in March, the lowest reading since March 2004. That is well below the long-term trend of 4.4%. The figure marks the fourth monthly drop, according to data from Bloomberg. “The leading index continues to point to an abrupt slowdown in economic activity,” said Westpac’s senior economist, Matthew Hassan. “After peaking near decade highs at 6.9% in November last year, the growth rate in the index has more than halved, falling well below trend. In fact the index is now further below trend than at any other time in nearly five years.” — Chris Zappone, SMH

Rebels leader Alex Vella wins a $2.4 million lawsuit against ANZ Bank. Rebels motorcycle gang boss Alex Vella has won a multi-million dollar lawsuit against the ANZ Bank over fraudulent loans to his former business partner. Mr Vella sued ANZ in the NSW Supreme Court over the alleged theft of three property deeds, including that of the Rebels’ clubhouse, by his former associate Tony Caradonna. Caradonna, who has since been charged with fraud, is accused of using forged documents to re-mortgage the three properties to the tune of $2.4 million. Mr Vella also claimed $300,000 was fraudulently withdrawn from their joint bank account, which had been set up to fund a venture relating to a 2006 boxing match between high profile fighters Anthony Mundine and Danny Green. Justice Peter Young today found in favour of Mr Vella, saying he was entitled to the three properties ”unencumbered by mortgages”. — Businessday.com.au

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