In a period marked by highs and lows, 2011 offered up loads of fun--and frustrations -- for private equity investors. Things got off to a merry start with neon-lit markets at full tilt in the first half of the year. Deals began to look like a throwback to the buyout boom as liquidity greased profits through initial public offerings, dividends and secondary buyouts. But then the euro zone imploded and American politics turned into black comedy. At least one ratings agency wasn't amused. Credit markets slammed shut, and a few PE folks stumbled in the dark. In an annual tradition, we present this year's Barrel Awardees:

The BENIGHTED BUDDIES AWARD goes to Jon Corzine and close pal and enabler, J. Christopher Flowers. The Goldman, Sachs & Co. veterans' reputation as whizzes was tarnished by MF Global Holdings Ltd.'s spectacular collapse in October. It was Flowers, a PE honcho who was an M&A star at Goldman in the '90s when Corzine chaired the firm, who recruited the ex-New Jersey governor to take charge of MF Global early last year. In 2008, Flowers' firm bought a big stake in the low-profile derivatives broker and believed Corzine would make it prosper, earning Flowers a bundle. Instead, MF Global's failure stands to cost Flowers about $48 million.

For Flowers, the debacle was only the latest woe. Flowers displayed his Midas touch in 2000 by engineering a $1.1 billion bailout of Japan's Shinsei Bank Ltd. that delivered a fivefold profit. But several subsequent deals, including hefty investments in Germany's Hypo Real Estate Holding AG, German shipping lender HSH Nordbank AG and a large follow-on investment in Shinsei, foundered. The $7 billion private equity fund Flowers raised in 2007 is worth a fraction of cost. Between Corzine and Flowers, the damage flowed both ways: Corzine eroded Flowers' firm's return, and Flowers managed Corzine's personal fortune -- another bet that backfired.

The CLEVER CRAMDOWN AWARD goes to Blackstone Group LP-backed Travelport Ltd., which in the summer faced default on a $715 million batch of pay-in-kind notes coming due next spring, with little hope of a saving IPO or a refinancing. It parlayed that urgency, a unique capital structure and some wiggle room in its borrowing agreement into a clever solution: It bought off the PIK holders -- its most junior creditors -- with a gift package of extended maturities, seniority in the capital structure, cash and 40% of Travelport's equity. Blackstone and the other private equity sponsors didn't really cede much value because they'd already recouped their outlay in a 2007 dividend, and Travelport's equity in any event was under water. Travelport's senior lenders pocketed rich fees to assent to the deal.

The only real losers were holders of the travel reservation company's $1.1 billion of senior unsecured bonds, who got crammed down. The bondholders raised a stink, arguing the restructuring was illegal, but backed off. With scores of debt-freighted, PE-backed companies facing a similar predicament, restructuring pros closely studied Travelport's moves.

Our BY HOOK OR BY CROOK AWARD goes to TPG Capital and Russian partner VTB Capital for adroitly fending off a disgruntled shareholder while acquiring control of Russian hypermarket chain Lenta LLC. TPG had paid $100 million to buy a 30.8% interest in 2009 from the founder. In June it teamed with VTB to acquire a further 31% from August Meyer, an American lawyer and businessman and Lenta's largest shareholder, with 40.6%. Meyer claimed, among other things, that the investors violated the agreement by replacing his representative as general director and illegally installing another. Meyer tried to reinstall his guy, but a state-backed task force forcibly removed him in a scene captured on video that soon went viral. The parties subsequently signed a deal, with all the protracted litigation to be settled upon closing.

The PIE IN THE FACE Award goes to family dining chain operator Perkins & Marie Callender's Inc. and Wayzata Investment Partners LLC, a Minnesota PE and hedge fund investor whose heavy-handedness evidently left hapless patrons at dozens of outlets hungry and angry. In June, a day before it filed for bankruptcy, blaming the economy, the restaurant chain, known for its warm pies and other bakery items, abruptly shuttered unprofitable restaurants, news accounts say, catching some customers midmeal. At one Seattle restaurant, someone's birthday party reportedly had to suspend festivities. The chain, formerly owned by New York PE firm Castle Harlan Inc., emerged from Chapter 11 Dec. 1, considerably lighter on debt and with debtholder Wayzata in control. But it may take a while to woo once-loyal pie lovers back again. n

Vyvyan Tenorio and David Carey cover private equity for The Deal magazine.