BTU acquisition of Meiya - Lessons in how a Private Equity group makes a $220 million purchase while having only $100 million (actually, BTU never mentions this but the price was $236 million)

THE STORY

An inauspicious start to the BTU involvement with Meiya.  It agreed to acquire Meiya for $220 million but ended up paying $236 million and had to BORROW $136 million from the SELLER to conclude the transaction. BTU is given three months to pay the loan but at some point BTU asks the SELLER for an extra month to come up with the remaining $99 million owed to the SELLER.  Subsequently, it BORROWS $105 million from a consortium of banks to pay the remaining $99 million. BTU is NEVER able to "take out" the loan. Throughout its entire life, the Meiya investment gets saddled with the debt and its costs and risks.

The Middle East investors that actually come up with the money for the purchase believe they bought Meiya for $220 million.  Abdulmohsen Hayat, the 44% owner of BTU Holdings, believes that Meiya was acquired for $220 million.  The BTU Ventures website announces the $220 million acquisition. Wael Al-Mazeedi is SILENT regarding the price in two of his affidavits filed in Massachusetts courts. 

Simple math. Price tag as told to EVERYBODY by BTU - monies actually received by PSEG - Cost of not having all the money required to complete the purchase in the first place = $220 million - $236 million - ($105 million - $99 million) =  -$21 million.

Meiya: another law firm, Minter Ellison, helps pull-off the sale by BTU

One would unquestioningly have to give a large (by their own account they have 280 partners and 1,000 legal staff), multinational, well-renowned law firm the benefit of the doubt that they know WHO their client is (who's paying their bills) and WHAT they are doing for it (what benefit the client receives in exchange). In other words, we should trust that Minter Ellison got their facts right. However, these facts don't "match" with other facts that are not subject to dispute.

The question then becomes, what are the "facts" regarding BTU's sale of Meiya Power Compay to Standard Chartered Bank?