Goldman Sachs Buys Stake in Closely Held Management Dynamics
Goldman Sachs Group Inc. (GS) bought a stake in Management Dynamics Inc., a closely held New Jersey company that makes software to automate international shipments.
“We plan to use the funds from Goldman to make a strategic acquisition to expand our product portfolio and further distance ourselves from the competition,” Management Dynamics Chief Executive Officer Jim Preuninger said in a statement today from the East Rutherford-based company.
Management Dynamics didn’t disclose the size of the stake. Michael DuVally, a spokesman for Goldman Sachs in New York, didn’t immediate reply to requests for comment.
Gene Yoon, a managing director at New York-based Goldman Sachs, will join the board of the company, according to the statement. Yoon is head of private equity for Goldman Sachs’s Americas Special Situations Group, according to a biography published on the Management Dynamics website.
Preuninger worked in sales and marketing for International Business Machines Corp. (IBM) before founding Management Dynamics in 1989, the company’s website says. John Preuninger, president and chief operating officer and Jim’s twin brother, was a strategy consultant at Monitor Company before joining Management Dynamics in 1990, Kathleen Hickey, a spokeswoman, said.
Goldman Sachs in January changed the way it reports its financial results, creating a new division called Investing and Lending. Investments by the special situations group, which buys distressed debt and equity and makes loans, have been mostly moved out of the company’s fixed-income, currencies and commodities division into the new investing and lending segment.
Investing and Lending contributed 19 percent of Goldman Sachs’s 2010 revenue, making it the second-largest division on that basis after institutional client services, or sales and trading, according to Goldman Sachs’s annual 10-K filing with the U.S. Securities and Exchange Commission.
In 2009, Investing and Lending accounted for 6 percent of the firm’s revenue, the filing showed, and in fiscal 2008 it had negative revenue of $10.8 billion, making it the only money- losing division that year.
To contact the reporter on this story: Christine Harper in New York at charper@bloomberg.net
To contact the editor responsible for this story: David Scheer at dscheer@bloomberg.net.
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