The report that midmarket buyout firm Cypress Group is winding down following
a spate of personnel defections and bad investments may be premature. The news
surfaced on The Wall Street Journal's Deal Journal blog Tuesday morning
prompting a TheDeal.com reporter to contact Cypress, which denied the report.
However, the news about trouble at the buyout firm isn't entirely new. The
Deal first speculated that something was amiss last summer when portfolio
company Scottish Re Group Ltd. announced July 31 that it expected a $130
million quarterly loss, which prompted Cypress to lose more than $140 million
of its $180 million investment in the company. Scottish Re wasn't the only dud
in Cypress' portfolio. The firm also invested in Frank's Nursery & Crafts
Inc., which first filed for Chapter 11 in February 2001, and online grocer
HomeRuns, which also folded in early 2001. However, at the time of the
Scottish Re news, the firm indicated that it was considering alternatives such
as SPACs rather than raising a new fund. —Matthew Wurtzel
See
story from Deal Journal
See
Scottish Re story from TheDeal.com
See
Cypress story from TheDeal.com
See
HomeRuns story from TheDeal.com
See
Frank's Nursery story from TheDeal.com
