Carlyle Group

KKR delays public listing

Jim Kim — Mon, 03 Nov 2008 12:50:51 -0500

Many of you likely thought it was ambitious of Kohlberg Kravis Roberts to plow forward to a public listing. The environment is hardly welcoming right now. So it's not really a surprise that the private equity giant has postponed plans for its going-public transaction to 2009, according to media reports. Previously, the deal was planned for sometime in 2008. KKR made headlines when it announced it will list on the NYSE Euronext via a takeover of its Amsterdam-listed investment fund, KKR Private Equity Investors, which continues to flag. The transaction would have killed two birds with one stone, listing KKR and shoring up KKR Private Equity. But the financial markets will not allow for it just yet. It's unclear if KKR Private Equity Investors will need some sort of capital injection. Recall that Carlyle Capital Corp., an affiliate of Carlyle Group, was also listed in Amsterdam; it went bankrupt in March.

For more:
- here's the CNNMoney article

Handicapping the Neuberger Berman sweepstakes

Jim Kim — Wed, 27 Aug 2008 14:09:38 -0400

Well, it certainly feels like an auction. Lehman Brothers has informed three private equity firms--Hellman & Friedman, Bain Capital and Kohlberg Kravis Roberts--that they are still in the running to buy its asset management operations. The Carlyle Group was knocked out; the Financial Times says its $7 billion bid was too low, though it was friendly to Lehman's demands. The Blackstone Group was also knocked out; it was never that committed to such a deal, given concerns over how fund managers would react. Lehman, however, remains undecided if it really wants to sell the unit. KKR and Hellman & Friedman would seem to have the inside track. KKR wants to be a diversified financial service company. Hellman & Friedman thinks the unit would be a good way to grow its asset management ambitions.

For more:
- here's the FT article

What does KKR see in Neuberger Berman?

Jim Kim — Tue, 26 Aug 2008 14:23:04 -0400

According to CNBC, Kohlberg Kravis Roberts has emerged as the leading candidate to buy Neuberger Berman, the mutual fund company owned by Lehman Brothers. KKR rival the Blackstone Group apparently is apparently not interested at all, while JC Flowers, Apollo Management and the Carlyle Group may fall somewhere in between. Neuberger Berman is seen as a top wealth management company. The details will be key. As reported, Lehman wanted to sell a 70 percent stake with an option to buy back the remainder later. Which doesn't sound like a great deal for any buyer. It's also unclear what such a sale will do to Lehman's earnings picture and how credit rating agencies will view such a sale. The clock is ticking for Lehman. That's for sure. They are not in position to drive a hard bargain.

For more:
- here's the article

Lehman Brothers courts private equity to buy unit

Jim Kim — Tue, 19 Aug 2008 08:10:18 -0400

So the rumors turned out to be true. Lehman Brothers is indeed shopping around its asset management unit, which includes Neuberger Berman, acquired five years ago for $2.6 billion, Lehman Brothers Asset Management and a private client brokers group. The New York Times reports Lehman has sent MOUs to a raft of private equity firms, including Kohlberg Kravis & Roberts, J.C. Flowers, the Blackstone Group, Carlyle Group and others. It invited bids on all or part of the unit. This is surely a sign that third quarter earnings may well be negative and that another capital raise will be required. Another step, more dramatic, would be to sell the whole company. The asset management unit provided a measure of diversification. If you sell those, you end up with the old Lehman. This nuclear option is not out of the question.

For more:
- here's the New York Times article

Big PE firms aim for Chinese mobile company

Jim Kim — Wed, 02 Jul 2008 22:10:20 -0400

The auction for Huawei's mobile device division is boiling. According to the Financial Times, Bain Capital, Kohlberg Kravis Roberts, Silver Lake and a Goldman Sachs private equity unit are safely through to the next round. Meanwhile, TPG, the Carlyle Group and the Blackstone Group either did not bid or failed to make it to the next round. Huawei is being advised by Morgan Stanley. The FT says Huawei wants to sell a significant stake to a private equity firm that can help it expand into the United States. Certainly, such a deal would also represent a key foothold in a country that most regard as laden with deal potential. Bain may have the inside track, given the experience gained when it teamed with Huawei to bid for 3Com, which never panned out. Stay tuned. It's unclear when all this will wrap up.

For more:
- here's the FT article

So who will run Wachovia?

Jim Kim — Mon, 30 Jun 2008 11:36:32 -0400

Wachovia chairman and interim CEO Lanty Smith is leading the search for the troubled bank's next CEO. Breakingviews suggests that he needs to hurry up. The delay, to be sure, does not speak well for the bank. Obviously, there was little in the way of formal succession planning. But the article suggests that the opening also represents a shocking lack of CEO talent right now in the banking industry. Those rumored to be in the hunt apparently include William Demcheck of PNC Financial, David Moffett of Carlyle Group, and Alvaro de Molina, a former CFO at Bank of America now with Cerberus. It's interesting that two of the three potential candidates currently are in the alternative investments industry. My sense is that Wachovia would be better off selling itself to a bigger bank. It's an option that board has to take seriously.

For more:
- here's the Breakingviews article

And the top-ranked private equity firm is ...

Wed, 21 May 2008 06:59:56 -0400

Fortune has come out with a list of top private equity firms according to recent fund raising activity, and the big winner is the Carlyle Group. Yes, its mortgage-backed securities fund stumbled, but so did a lot of others. It's buyout and other funds fared well enough, apparently, to earn the top spot. The Blackstone Group, Kohlberg Kravis Roberts, Bain Capital, Warburg Pincus and TPG round out the top six. Out of nowhere: U.S.-based Advent International, which soared to 7th from not even being ranked the year before. It has specialized in European, middle-market type deals. Another newcomer: First Reserve, which came in 10th after being unranked in 2007. It's forte apparently is energy deals.

For more:
- here's the Fortune list

What to make of Carlyle's deal with Booz Allen

Mon, 19 May 2008 06:59:58 -0400

The New York Times notes that the Carlyle Group for the longest time had a PR problem. It was seen as the "ultimate Washington insider" with ties to the government, business and the military. Business Week once likened it to a firm right out of a Grisham novel. For me personally, the hiring of Lou Gerstner, ex-CEO of IBM, in 2002 as chairman was a big sign that the firm wanted to put itself on a new course. He replaced Frank Carlucci, Defense Secretary during the Reagan Administration. But you have to wonder, as does the Times, if the firm's deal for the government contracting side of Booz Allen Hamilton will revive its old image. Probably not. The fact is that deals are hard to come by these days, and government contracting is in major growth mode.

For more:
- here's the New York Times article

And the biggest private equity firm is...

Thu, 01 May 2008 06:59:56 -0400

When it comes to private equity firms, people tend to have a size complex. Private Equity International has just come out with its second annual list of private equity firms based on the amount of money they raised over the past five years. The winner for the second year in a row is The Carlyle Group, which raised $52 billion. Coming in second: Goldman Sachs Principal Investment Area, at $50 billion, which knocked Kohlberg Kravis Roberts--fourth this year at $40 billion--out of that spot. The third place finisher was TPG, at $39 billion. London-based CVC Capital Partners rounded out the top five at $37 billion. The Blackstone Group finished in 10th place, after placing fourth last year.

For more:
- here's a summary
- here's a New York Times recap

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Wed, 23 Apr 2008 06:59:50 -0400

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