TXU Buyout: Consider the Consequences

Given that a $45-billion sale of TXU Corporation (TXU) to private equity firms Texas Pacific and KKR is apparently a done deal, it's worth thinking about some of the consequences. For starters, while this is a big deal, it isn't yet the largest in history. That honor still sits with KKR's 1988 deal for RJR Nabisco. Inflated to today's dollars, the then-$25-billion deal becomes a $63.2-billion deal.

And that raises an interesting question. Given that there is far more private equity under management today than there was in 1988, and that the appetite in debt markets remains unabated for leveraging these things, it seems inevitable that we will surpass RJR Nabisco in deal size.

So, who does that bring into play? Well there are 80 or so U.S.-listed companies with market capitalizations between $45-billion and $100-billion. The names include Apple (AAPL), Dell (DELL), Oracle (ORCL), Kraft (KFT), eBay (EBAY), Lowe's (LOW), Target (TGT), and Time-Warner (TWX), among many others. The better question might be, Who's not in play when you get up into these kinds of numbers?