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More on that Maumelle AA rating.

More On That Maumelle AA Rating

Did you raise your eyebrows, smile and say "Hmm...", like we did after reading the recent Barron's article (Aug. 27) on Duff and Phelps? A couple of weeks ago we reported that D&P, the esteemed Chicago-based bond-rating firm had christened Dehaven and Todd Company with a AA rating on their commercial paper.

A few days later, as we perused our "hot off the press" Barron's, we found cause to question the fine reputation of D&P and the objectivity of their rating of the Maumelle-based company. Maybe D&P's "esteem" was running out.

In a lengthy and complex article by Benjamin Stein, D&P is accused of being owned, in great part, by the entities it rates. The majority owner of the company is actually a fund, Freeman Spogli Equity Partners II, spearheaded by Los Angeles LBO guys Freeman and Spogli. So we couldn't help but wonder--is Dehaven hooked up with this bunch somehow? We made some phone calls.

We started with D&P. The first time we spoke with them, they could not find any record of having rated Dehaven and Todd or The Maumelle Co. at all. Lordy, we thought. Second call to Chicago, and they say oh yes, they did recently rate the company AA, it's just that the paperwork is not complete so it's not on their computer yet. And as far as they know, there is no connection between the Arkansas company and their own.

Meanwhile, we called Dehaven, who managed to return the call from a vacation spot in California. He says he has never heard of Freeman, Spogli, or FS Equity Partners II, but now he would sure like to read the Barron's article.

Talk about credibility problems, how about Benjamin Stein, the author of the Barron's article? Seems he wrote a slanderous article after the suicide of Joan Rivers' husband, Edgar. Joan sued, and won, to the snappy tune of about $2 million.
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Title Annotation:Whispers; Dehaven and Todd Company; D&P
Publication:Arkansas Business
Date:Sep 10, 1990
Words:328
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