Lone Star Funds Goes South in South Korea, But Tops Mag's List of Dumbness
I knew I was obsessed with Lone Star Funds' South Korean fiasco for a reason: It's the 30th "Dumbest Moment in Business" in 2006, according to the latest issue of Business 2.0. Here's the headline: "Try apologizing and offering a huge charitable donation. We hear that works great in Korea!" Heh.
John Grayken and his Harwood Street-based company come in between a South Korean slush-fund scandal and Goldman Sachs' attempts to shut down the completely unrelated Web site Goldmansex.com, a directory of strip clubs and escort services. What Business 2.0 has to say about Lone Star Funds is after the jump. --Robert Wilonsky
In the wake of the Hyundai scandal, Dallas-based private equity fund Lone Star finds itself under investigation for various financial shenanigans relating to its 2003 takeover of Korea Exchange Bank. Though Lone Star denies any wrongdoing, it nonetheless offers a public apology and announces that it will donate $100 million to charity.
The mea culpa fails to impress KEB employees, who hijack Lone Star's apologetic/philanthropic press conference with a chant that translates to "Let's destroy foreign vulture funds."
In November, Lone Star backs away from a deal to sell its KEB stake for a $4.5 billion profit, citing the ongoing investigation.