Two of the godfathers of modern-day private equity investing, Henry Kravis and George Roberts of the famous leveraged buyout firm KKR (NYSE: KKR), have handed in the reins by stepping down as Co-CEOs from their firm. Replacements have been named for them, effectively . Henry Kravis and George Roberts, together with the late Jerome Kohlberg, pioneered America's industry of "leveraged buyouts (LBO)" where Wall Street firms bought companies using borrowed money, with the companies themselves used as collateral for debt and their future profits used to pay it down. LBOs built a reputation as a form of "ruthless" capitalism that continues to this day, because of some strong-arming tactics by which Wall Street firms chased after them. This tainted reputation made LBO firms rebrand to what we currently call private equity firms. At KKR, Kravis and Roberts' landmark deal was acquiring RJR Nabisco , a tobacco and food giant, for $25bn , mostly borrowed money, in
Mindbody , a leading maker of software for managing gyms and fitness studios, is buying one of the hot startups in its industry. It's buying ClassPass , a popular subscription platform for widespread gym access and online fitness classes. Mindbody will buy Classpass for an undisclosed amount . The company, owned by private equity firm Vista, also announced a strategic $500mn investment along with its ClassPass deal. The acquisition was all with privately held shares, Mindbody said. ClassPass is a celebrated startup in the fitness space. It began as a simple website to book fitness classes with registered studios but morphed into a subscription platform for access to such studios and their fitness classes, with many users paying recurring fees as a steady revenue source. ClassPass was valued at $1bn from a funding round last year. Given the acquisition's pricing terms weren't disclosed, we can't say for sure if it was higher or lower than the $1bn mark, but for a hint,
