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Illustration: Eniola Odetunde/Axios

If you can't beat them, join them. And then beat them.

Driving the news: Silver Lake acquired a 12% stake in Far Point Acquisition (NYSE: FPAC), in order to help force the blank-check acquisition company to complete its $2.6 billion takeover of Swiss payments firm Global Blue.

Backstory: Far Point was formed in 2018 by former New York Stock Exchange president Tom Farley and activist investor Dan Loeb (via his Third Point hedge fund), and raised $550 million in its IPO.

  • Far Point's goal was to buy a fintech, and in January 2020 agreed to acquire Global Blue from Silver Lake (which would retain a minority stake). Global Blue focuses on tax refunds related to tourism shopping.
  • Like with all blank-check acquisition companies, or SPACs, Far Point requires shareholder approval for its takeovers.
  • On May 7, Far Point's board unanimously recommended that shareholders vote against the Global Blue deal, based on economic changes driven by the coronavirus pandemic.
  • Silver Lake seethed.

To be clear, Silver Lake wasn't like a pro baseball player insisting that Far Point agree to the exact same terms in changing circumstances. It did make concessions, but not enough to appease Far Point. So it took advantage of Far Point being a publicly traded company — unlike a traditional private equity fund — and bought the 12% stake.

  • Third Point previously committed its shares to the deal, which means 37% of Far Point shareholders are now officially in favor.
  • That's still short of the required 50.1% needed to okay the deal, but that threshold is of outstanding shares rather than voted shares (meaning the gap may be smaller than it appears).
  • Silver Lake could up its odds by buying more stock in the open market. That may be a bit counterproductive in terms of exiting its investment, but still would bring Global Blue public and better capitalize the company via a deal structure that includes outside investments from such firms as Alibaba's Ant Financial.

Of note: Farley declined to comment when I messaged him earlier Thursday morning, and a Silver Lake spokesperson hadn't returned my email as of this writing.

The bottom line: Silver Lake is playing both sides of the deal. It's the sort of thing that would seem unethical, or even illegal, in other contexts. But it seems fair when it comes to these dealings with Far Point and Global Blue. Tough, but fair.

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Why it matters: What happens next will be a test of McCarthy's party control and the sincerity of his opposition to the movement. Cheney (R-Wyo.) is seen as a potential leadership rival to the California Republican.