Oxbow: A Study In The Cost Of Misalignments In Good Deals

By Kyle Gann and Jason Osborn ( February 6, 2019, 3:20 PM EST) -- By nature, equity interests in private companies are illiquid. One of the key issues for investors, and in particular, private equity sponsors, to consider in any investment is the path to liquidity. The specific issues that arise in negotiations will depend on whether the investment is for a controlling or noncontrolling stake. The recent Oxbow Carbon LLC Unitholder Litigation in Delaware between William Koch and certain minority investors in Oxbow Carbon LLC provides an opportunity to conduct a case-study of how things can go badly wrong on a minority investor's road to liquidity....

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