Schapiro: Divide and conquer was Youngkin’s M.O. even before politics | Govt-and-politics

As co-CEO of the Carlyle Group, Youngkin made big bets that wresting control of this company or that one would yield fat dividends for himself, his partners and, after the private-equity giant went public, its shareholders. It worked time and again, though not without bursts of controversy, some of it tied to Carlyle’s hiring of Washington insiders when its subsidiaries were trolling for high-dollar federal contracts.

What Carlyle does best is peel from other companies – divide, if you will – holdings euphemistically labeled underperforming, buying them with borrowed money and paring their overhead, in part, through layoffs, to promote profits. Then, the hopped-up acquisition – conquered, if you will – is sold at a premium, allowing for prompt repayment of any loans, with the remaining proceeds tidily pocketed as profit.

A sweet deal for Carlyle was its acquisition in 2005 from a French wine and spirits company of Dunkin’ Donuts. Purchased for $2.4 billion in 2005 by Carlyle and two other private equity shops, the coffee-and-doughnut chain was taken public six years later, having significantly expanded its footprint and payroll. Stock sales generated a three-fold profit of $1.8 billion, divided equally among the three firms. Dunkin’ Donuts – now, simply, Dunkin’ – again went private in 2020.

Youngkin, who presumably laughed all the way to the bank over a deal that was all about unhealthy foods, must have still been chuckling over it as a candidate. Among the bumper stickers produced by his campaign was one that parodied the doughnut retailer’s slogan, signage and color scheme: “Virginia Runs on Youngkin.”