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Does 3 o'clock work today for a quick call?
Jimmy

On Tuesday, March 24, 2015, Devon Archer <darcher@rosemontcapital.com>
wrote:

> Me as well.
>
> Devon D. Archer
> 646 436 3745
>
> On Mar 24, 2015, at 7:51 AM, James Bulger <jbulger@thorntonai.com
> <javascript:_e(%7B%7D,'cvml','jbulger@thorntonai.com');>> wrote:
>
> Free any time after. 2 today.
>
> On Tuesday, March 24, 2015, Hunter Biden <hbiden@rosemontseneca.com
> <javascript:_e(%7B%7D,'cvml','hbiden@rosemontseneca.com');>> wrote:
>
>> Let me know a good time for tomorrow.
>>
>> RHB
>> 202.333.1880
>>
>> On Mar 23, 2015, at 5:07 PM, James Bulger <jbulger@thorntonai.com> wrote:
>>
>> Hunter
>>
>> I am concerned about what happens if we win the Hanson deal Saw no sense
>> in prematurely ringing the alarm in light of the fact we still I have no
>> knowledge of exactly what a success means here to BHR.
>>
>> We have a problem with Jonathan and his team on a number of fronts
>>
>> A fix is not easy but if we hope to get BHR moving forward we had
>> better get a plan in place.
>>
>> Do you guys have time for a call before Wednesday mornings Aleris call?
>> I know you are both out of town but a half hour call prior to our next
>> conversation with BHR would help us handle the Aleris call . Lay some
>> ground rules down for the crew in Beijing
>>
>> You guys have time tomorrow for a quick chat?
>> Jimmy
>>
>> On Monday, March 23, 2015, Hunter Biden <hbiden@rosemontseneca.com>
>> wrote:
>>
>>> Jimmy-
>>> I couldn't agree more. What I don't understand is why they wouldn't want
>>> us directly involved. I understand after 10 years of this the cultural
>>> differences blah, blah... But, in this case it defies all reason and logic.
>>> It's almost as if they are trying to keep us away from the deal. After our
>>> last board meeting where we expressly asked to be included I followed up
>>> with emails asking for information about the company to see if we had any
>>> connections to the board etc... And heard nothing. Another concern is that
>>> they do buy a US company and offshore it and we are caught blindsided by
>>> negative press. Anyway- we have to begin to change their behavior for this
>>> to work.
>>>
>>> RHB
>>> 202.333.1880
>>>
>>> On Mar 23, 2015, at 3:21 PM, James Bulger <jbulger@thorntonai.com>
>>> wrote:
>>>
>>> Gentlemen,
>>>
>>> I am sending you this brief note about the car parts manufacturer, code
>>> named the Hanson (AVIC is co-investor) deal in order for you to get an
>>> understanding of how I think we "might" help BHR management.
>>>
>>> During our call with Xin today (which neither Jonathan nor anyone else
>>> from BHR besides Xin joined) we learned that BHR/AVIC lost the Dickson bid
>>> to a Japanese firm. If you recall this was a bid on another auto parts
>>> manufacturer that BHR was very keen on winning. We've been briefed for
>>> months about how the Dickson deal was coming along and, when I've had a
>>> chance, I've volunteered the American sides' assistance in order to help
>>> with that deal. This was often met with nods and words of approval by the
>>> BHR team but no real effort was made to seek our help. Well when we stopped
>>> hearing about this deal recently I feared the worst and now today we have
>>> had it confirmed by a subordinate of Jonathan's in an off-handed comment on
>>> a conference call that our bid was not accepted and that the deal had
>>> died...
>>>
>>> Unfortunately this pattern of behavior is more of the same from the
>>> BHR side.
>>>
>>> Now I point that out just because, while BHR lost the Dickson deal,
>>> there is another auto-parts deal that is ongoing and that is the Hanson
>>> project. We learned today on the phone call that the final binding
>>> offer on the Hanson deal is due on April 6th and three other
>>> competitors remain. Xin believed this project could close as early as May
>>> if our bid was accepted. Xin also mentioned that AVIC is very keen on
>>> winning the Hanson deal especially since we lost the Dickson bid.
>>>
>>> During previous calls and meetings in Beijing I learned that Xinzhong
>>> has been working on this deal and he has spent weeks in Detroit with the
>>> AVIC team reviewing documents and interviewing Hanson executives generally
>>> conducting DD.
>>>
>>> I have tried many times to get information regarding this project, but
>>> in true Chinese fashion information is not readily shared with us. This
>>> despite the fact that the seller is based in the USA and that the bidding
>>> process is being conducted by the seller's investment bank whom we might
>>> have direct connections to. However, this is a very large deal in dollar
>>> terms and after the SINOPEC snafu closing a large deal in April would be
>>> very beneficial to BHR.
>>>
>>> The seller is based in the Detroit area. At this time in the process it
>>> might be too late to help BHR from the US side particularly in light of the
>>> fact that there is a bidding process being conducted by an Investment Bank
>>> on behalf of the seller.
>>>
>>> It is my belief that I and perhaps one or both of you might still be
>>> able to assist in the process. For example, having a large Chinese entity
>>> such as AVIC trying to purchase a large manufacturing entity in the US
>>> might be disconcerting to local stakeholders such as Unions and local
>>> elected officials concerned about job losses to an overseas buyer. In order
>>> to mitigate such valid concerns it would be wise for me to meet local
>>> elected officials (through SLLF contacts) and brief them on our plans for
>>> the business post purchase. At the very least having us associated with the
>>> buyer would help allay some fears in the mind of the seller and other stake
>>> holders. Consider for a moment that one of the other 3 bidders is a US
>>> based company. It is plausible then that they are prodding the seller to
>>> stay onshore etc..... The other 3 bidders have not been disclosed to me and
>>> yes I have asked in the past for their names. Perhaps there is a consultant
>>> hired by Hanson on the Federal level, if there is such a consultant then
>>> perhaps he is friendly and perhaps he should be made aware we all are
>>> stakeholders in this endeavor, that would be good information for Hanson
>>> (the seller) to have in hand.
>>>
>>> One of BHR's strong points is that we have excellent partners/owners in
>>> the US. Here we have a situation where BHR coupled with AVIC is bidding to
>>> buy a large US based firm and the US based owners/ Board members of BHR are
>>> kept in the dark.
>>>
>>> I believe we could have helped a company we OWN win a significant piece
>>> of business. Perhaps it is too late in the process, and maybe BHR
>>> management has a very good reason for not involving any of us in the
>>> process but here are a few final thoughts to consider:
>>>
>>> #1. I don't know how the deal is structured so I don't even know how BHR
>>> gets compensated. Clearly our Fund is not fully funded so we likely will
>>> not invest alongside AVIC, unless of course this is a deal where if we win
>>> it Gouxin would come into our fund as a large LP.
>>>
>>> #2. I'm pretty sure Lazard is acting as the BHR /AVIC banking
>>> consultant. I know you guys have relationships over at Lazard. I think
>>> Lazard would be wise enough to know how, or if we as individuals, might be
>>> able to assist in this process. Do you think it might be wise to speak to
>>> someone at Lazard? With the full knowledge of Jonathan and management of
>>> course, not looking to upset the apple cart here. Lazard should at least be
>>> made aware that we have an interest in helping.
>>>
>>> #3. Without seeing a budget and projections from Management I have no
>>> way to determine what fee etc.... This Hanson deal actually means to BHR.
>>> Clearly though a win is a win, and Burnham for instance, would be happy to
>>> mention a win other than SINOPEC while they are out fundraising.
>>>
>>> I hope you take the time to read my note. I am using this deal as an
>>> example of how our management team needs to open up the communications.
>>> There is no excuse for the 3 of us not to be involved at some level in the
>>> Hanson project. We own BHR, furthermore we want it to succeed as much as
>>> anyone. The BHR management team has kept us in the dark. It troubles me
>>> that the management team at BHR never asked for our thoughts, advice or
>>> insight while chasing a buy out of a very large US firm.
>>>
>>> I suggest that we all have a call about this before the BHR conference
>>> call on Wednesday so that we can make sure that we as Americans are all on
>>> the same page. Let me know when you guys are free.
>>>
>>> Thanks,
>>> Jimmy
>>>
>>> --
>>> James J. Bulger
>>> Chairman
>>> Thornton Group LLC
>>> 14 Beacon Street, Suite 804A
>>> Boston, MA 02108
>>> Office tel: 617.248.9440
>>>
>>>
>>
>> --
>> James J. Bulger
>> Chairman
>> Thornton Group LLC
>> 14 Beacon Street, Suite 804A
>> Boston, MA 02108
>> Office tel: 617.248.9440
>>
>>
>
> --
> James J. Bulger
> Chairman
> Thornton Group LLC
> 14 Beacon Street, Suite 804A
> Boston, MA 02108
> Office tel: 617.248.9440
>
>

--
James J. Bulger
Chairman
Thornton Group LLC
14 Beacon Street, Suite 804A
Boston, MA 02108
Office tel: 617.248.944