Jeb Bush Has a Mitt Romney Problem

By Joshua Green,

A private-equity-guy presidential candidate with lots of deals for the press to untangle—it sounds at least 47 percent familiar.

Over the last several months, former Florida Governor Jeb Bush has been giving speeches, campaigning for candidates, appearing at public forums, and meeting with wealthy donors, which has led many people to believe that he may soon enter the race to become the next Republican presidential nominee. On Dec. 1, Bush told a gathering of business leaders at the Four Seasons Hotel in Washington that he would make a decision about his political future “in short order.” But Bush’s recent business ventures reveal that he shares a number of liabilities with the last nominee, Mitt Romney, whose career in private equity proved so politically damaging that it sunk his candidacy.

Documents filed with the U.S. Securities and Exchange Commission on Nov. 27 list Bush as chairman and manager of a new offshore private equity fund, BH Global Aviation, which raised $61 million in September, largely from foreign ­investors. In November the fund ­incorporated in the United Kingdom and Wales­—a ­structure, several independent finance lawyers say, that operates like a tax haven by allowing overseas investors to avoid U.S. taxes and regulations.

BH Global Aviation is one of at least three such funds Bush has launched in less than two years through his Coral Gables, Fla., company, Britton Hill Holdings. He’s also chairman of a $26 million fund, BH Logistics, established in April with backing from a Chinese conglomerate, and a $40 million fund involved in shale oil exploration, according to documents filed in June and first ­reported on by Bloomberg News. His flurry of ventures doesn’t suggest someone preparing to run for president … Most private equity funds have a life span of 10 years. While it isn’t impossible that Bush could bail on his investors so soon after taking their money, “that would be unusual,” says Steven Kaplan, a private equity expert at the University of Chicago Booth School of Business. One fundraiser for private equity adds that normally you’d be winding down such businesses, rather than expanding them, if you were going to run.

Until now, many people have assumed that Bush’s greatest challenge would be dispelling the perception among Republican primary voters that he’s a moderate in a party dominated by right-wing conservatives. In the wake of Romney’s bruising 2012 loss, however, Bush’s overseas funds, mysterious investors, and foreign entanglements could prove harder to overcome. As a budding private equity mogul, he’s begun to resemble a Mini-Mitt. Bush declined to be interviewed for this article.

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