Lone Star Funds

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Lone Star Funds is a worldwide private equity firm based in Dallas, Texas, that specializes in purchasing distressed companies and assets, often well-known consumer brands that have seen better times or gone through financial difficuties due to leveraged buy-outs. It also purchases underperforming and non-performing loans from banks; recently, the company has been active in Germany in purchasing such loans.^[1]

John Grayken is the company founder and chairman.

1 Holdings
2 Alleged tax-evasion in Japan
3 References
4 External links

[edit] Holdings

This list is incomplete; you can help by expanding it.

Tokyo Star Bank, acquired 2001, noticed with its unique stragetic operations like Master Debit Card (first in Japan).
Korea Exchange Bank, acquired 2003; Lone Star was attempting to sell it to Kookmin Bank, but is facing criminal investigations from South Korean regulators for stock manipulation, among other charges.^[2] It is now negotiating a deal with HSBC.
B-Line, LLC, acquired 2006; Lone Star acquired from the founder and another private equity firm.
Lone Star Steakhouse, acquired in 2006 (Note: The name similarity between the investment firm and the restaurant chain is coincidental; the companies had no relationship prior to the purchase.)
BI-LO, acquired in 2004 from Royal Ahold ^[3], currently up for sale.
Bruno's Supermarkets, acquired in 2004 from Royal Ahold.^[4]
Shoney's Restaurants, acquired in 2002 and sold to a similar investment firm on January 1, 2007 [1]
Allgemeine Hypothekenbank Rheinboden AG (AHBR) of Frankfurt (Germany) acquired from the German trade union federation in 2005 and since renamed Corealcredit
Solare Hotels and Resorts of Japan. Lone Star purchased the company from the bankrup Chisun Company in 2002. In November 2007, Lone Star announced they would sell Solare.
Del Frisco's Restaurant Group, spun off from Lone Star Steakhouse in October 2007.
Kukdong Engineering & Construction Co., Ltd., acquired in June 2007.
STARLease Co., Ltd., acquired in June 2007.
Accredited Home Lenders Holding Co., acquired in October 2007.

[edit] Alleged tax-evasion in Japan

Lone Star gained profit by collecting non-performing loans handed over from former Tokyo Sowa Bank (Tokyo Star Bank), which collapsed in 1999 and was then granted 760 billion yen from Japanese government. However, the profit was transferred to a fund based in Bermuda via an Irish corporation (supposedly only a shell), which barred Japanese government from directly collecting taxes. The company did not report the profit, but the tax authority (Tokyo Regional Taxation Bureau) recognized the case, corrected Lone Star's accounting by about 14 billion yen for years 2002 and 2003, and adjusted the company's corporate tax by 5 billion yen including additional tax. However, the company has not yet paid the tax and because it owns no domestic assets, the government so far could not seize its property.^[5]^[6]