Goldman Sachs has had a fair bit of bad publicity of late, starting with the resignation letter of executive Greg Smith, published in the New York Times where he describes a company obsessed with making money to the point where they are calling clients "muppets." Significantly, Smith has now landed on his feet securing a $1.5 million book deal with the Hachette Book Group after torching the ground at his old place of work. Which means we can expect more revelations about the unsavoury goings on at Goldman Sachs.
And still it continues. In the New York Times again this week when columnist Nicholas Kristoff revealed that Goldman Sachs had a 16 per cent stake in a web site called Backpage.com which happens to be the biggest forum for under-age girls in the US. That site is owned by an opaque private company called Village Voice Media which is in turn backed by private equity including Goldman Sachs.
Realising that it can't just keep attracting all this bad publicity, Goldman Sachs is now selling the stake in Village Voice Media. Reuters reports: "The fund began negotiations with Village Voice Media in March, after deciding in 2010 that it had grown "uncomfortable with the direction of the company," and Goldman's inability to influence its operations, said Andrea Raphael, a Goldman Sachs spokeswoman."
How much money has Goldman Sachs lost on that deal? No-one's saying.