Tuesday, July 17, 2012

Romney Still Profits From Bain, Including Deals That Lay Off Thousands

Mitt Romney claimed that he left Bain Capital in 1999, three years earlier than he actually did, to avoid charges that the equity firm's companies went bankrupt and laid off workers during his tenure. He also wants to curtail discussion that Bain invested in firms that moved jobs overseas–clearly a contradiction to his pledge to bring jobs back to America. Romney, though, is still tied to Bain, well past the three extra years. He continues to profit from Bain, including from transactions that have resulted in thousands of job losses:

...In what would be the final deal of his private equity career, he negotiated a retirement agreement with his former partners that has paid him a share of Bain’s profits ever since, bringing the Romney family millions of dollars in income each year...

...In the process, Bain continued to buy and restructure companies, potentially leaving Mr. Romney exposed to further criticism that he has grown wealthier over the last decade partly as a result of layoffs.

...During his political career, Mr. Romney has promoted his experience as a businessman while deflecting criticism of layoffs caused by private equity deals by noting that he left Bain in 1999. But records and interviews show that in the years since, he has benefited from at least a few Bain deals that resulted in upheaval for companies, workers and communities.

One lucrative deal for Bain involved KB Toys, a company based in Pittsfield, Mass., which one of the firm’s partnerships bought in 2000. Three years later, when Mr. Romney was the governor of Massachusetts, the company began closing stores and laying off thousands of employees. More recently, Bain helped lead the private equity purchase of Clear Channel Communications, the nation’s largest radio station operator, which resulted in the loss of 2,500 jobs.

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