David Rubenstein’s 15 Points Of Light Presentation

February 5, 2009

If you’ve been to a Private Equity-related conference lately you’ll have recognized the overcast of pessimism and gloom that has become a permanent fixture at these affairs. However, while hunkering down in every storm a certain solice can be taken from the knowledge that the tempest can’t last forever.

David Rubenstein of the Carlyle Group offered up small rays of sunshine yesterday when he gave an excellent presentation at Super Return in Berlin.  As much a “must-see” powerpoint for Bouyout professionals as Sequoia’s was for VCs. Here it is:


Davos 2009: Rubenstein Says Buyout Financing May Resume by Year End

January 31, 2009

From the ongoing World Economic Forum in Davos, Switzerland here’s David Rubenstein, co-founder of the Carlyle Group, talking to Bloomberg’s Erik Schatzker about the outlook for Private Equity dealmaking in 2009:

…And the Layoffs in Private Equity Begin

December 3, 2008

Ok, so the industry has had layoffs before (for VC there was a wave of firms downsizing after the dotcom bubble burst in the early 2000’s, etc.) but for buyout houses the coming months may see some historic scaling back of personnel. First up there’s American Capital cutting 19% of it’s workforce which should total about 110 people across it’s US and European offices. 3i is trimming 15% of it’ workforce, which represents over 100 individuals. Now, the Carlyle Group has just announced that they are paring back about 100 jobs, or 10% of its work force, citing “extraordinary market conditions.” This move that is seen as a step to get the firm back to it’s early 2007 personnel levels. In all cases the majority of the layoffs are coming from the backoffice (HR, Legal, Accounting, etc.), but not all.

Private Equity has often been cited as a possible substitution for traditional I-Banking. Forgetting that debate for now, it’s still interesting to point out Private Equity’s quick learning of the I-Banking binge-and-purge HR policies. Talk to any recruiter over the second half of 2007/first half of 2008 and they would have openly expressed dismay at the fact that buyout shops were still recruiting and hiring. Now the reality of the situation has hit home and the firms are looking to shed some of the dead weight that is sitting idle until the debt markets return (Buyout houses won’t start making deals in high numbers again until the leverage returns. It’s much harder to break a hurdle rate without gearing). Until then the employment numbers in the business will contract.

On a side note I’m graduating at the end of this month. God did I time this market wrong. Oh well.

Deep breath.

It’ll all work out. It’ll all work out.

Carlyle’s Colby on M&A in 2009

December 2, 2008

Thanks to TheDealVideo, here’s Jonathan E. Colby, managing director of The Carlyle Group speaking about dealmaking and IPOs in 2009 at The Deal’s M&A Outlook 2009 conference:

Carlyle Closes €530M European Technology Fund

November 3, 2008

The Carlyle Group’s second European technology fund has just closed at €530m, exceeding its initial target of €500m.  The fund, Carlyle Europe Technology Partners II, was founded in 2007 and invests in emerging technology companies in Europe.  This is its first and final close.

The Carlyle Group has long displayed an interest in European tech firms, dating back to 2000 when they launched Carlyle Venture Partners and raised €553m for venture capital investments in emerging technology companies in Europe.  CETP II follows upon the success of Carlyle Europe Technology Partners which was launched in 2005 and raised a total of €222m.

CETP II invests between €20m and €60m in small and mid-cap buyouts and expansion capital, focusing on technology companies operating in Carlyle’s core sectors of aerospace and defence, automotive and transportation, business services, consumer and retail, energy and power, financial services, healthcare, industrial, infrastructure and telecommunications and media.

The Carlyle Group now manages €15.4 billion in 17 dedicated European funds across corporate private equity, real estate and alternative investments.

By Request: Private Equity at the 2008 World Economic Forum

September 14, 2008

I sent this video out to the club back in January and I’ve been asked by a member to resend it to him, instead I thought I’d just embed it here. It’s from the session “Myths and Realities of Private Equity” at the past World Economic Forum in Davos, Switzerland (January 26, 2008).  The panel consists of Donald J. Gogel, President and Chief Executive Officer, Clayton, Dubilier & Rice; Martin C. Halusa, Chief Executive Officer, Apax Partners Worldwide; Anatol Kalesky, Associate Editor of The Times; Josh Lerner, Professor of Finance, Entrepreneurial and Service Management, Harvard Business School; and David M. Rubenstein, Co-Founder and Managing Director, the Carlyle Group.

Private Equity Expanding Into Leveraged Loans; Moulton Offers Warning

August 21, 2008

According to Standard and Poor’s cash-rich Private Equity firms are expected to continue to buy up leveraged loans at a high pace.  Leading firms such as Apollo (who’s raising up to £1.1B to buy badly performing loans from European banks), Blackstone (who bought GSO Capital earlier this year), TPG (which has raised a distressed credit fund), Cinven (which recently acquired half of debt advisory and management firm Indicus Advisors), Carlyle (which closed it’s second distressed fund of $1.35B earlier this year) and others have gotten into the game recently at a much greater level than in the past.

After the credit crunch hit last year, the banks were left holding more than $200B of “hung” leveraged loans, which they underwrote on generous terms during the debt boom, and no where to move them.  Enter the private equity firms with many fresh off of fundraisings to take the debt off the bank’s hands.  However, not everyone (particularly John Moulton of Alchemy Partners), is under the mindset that this is a match made in heaven.  Amongst his reasons he points to the limited possibility of returns if a firm uses a fund designated for buyouts to buy up debt as any gain would be capped versus the unlimited upside return potential of equity.  Time will tell!