No conflict, no interest

That’s the joke, anyway, among firms and people with built-in conflicts of interest in their jobs. Lawyers, for example, who know everybody in town — and represent most of them. Labor organizers who have relationships with governors. And investment bankers whose own firms have buyout arms.

As I reported my recent article on Kinder Morgan (KMI), I asked numerous buyout investors not involved in the deal if they were bothered by the role Goldman Sachs (GS) played as advisor, investor and debt financier. The typical response was that there was enough work going around and so it wasn’t such a problem. That may be about to change. A handful of private-equity firms, including Blackstone, Providence, KKR and Carlyle, are complaining that they weren’t treated fairly in the sort-of auction for Alltel (AT) claimed by …. TPG and Goldman Sachs. Goldman’s investment banking unit is advising the buyers in this deal.

It’s a complex deal - aren’t they all? - and some good explanatory stuff can be found in this Wall Street Journal Deal Journal entry as well as in reporting by Andrew Ross Sorkin in The New York Times. (Note Sorkin’s fascinating tidbit about how the winning group exceeded debt-to-equity levels set out by management in the bidding process. Also note the WSJ’s contention that Alltel management wanted to end the process quickly because it was concerned someone else would launch a lowball bid. That doesn’t make a helluva lot of sense.)

The point here is that what passes as business as usual in good times starts to get new scrutiny as deal conditions become stricter and fears begin to rise that we’re seeing a top in the buyout boom.