Carlyle Group

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The Carlyle Group
Image:Carlylelogo.PNG
Type	Private Partnership
Founded	1987
Headquarters	Washington, D.C.
Key people	Louis V. Gerstner, Jr., Chairman William E. Conway, Jr., Founder Daniel A. D'Aniello, Founder David M. Rubenstein, Founder John F. Harris, CFO
Industry	Financial Services
Products	Management buyouts Real estate Leveraged finance Venture and growth capital
Revenue	Undisclosed to public
Employees	750
Slogan	N/A
Website	www.carlyle.com

The Carlyle Group is a Washington, D.C. based global private equity investment firm with more than $75.6 billion of equity capital under management.^[1] The firm operates four fund families, focusing on leveraged buyouts, venture & growth capital, real estate and leveraged finance investments. The firm employs more than 515 investment professionals in 21 countries with several offices in North America, South America, Europe, Asia and Australia; its portfolio companies employ more than 286,000 people worldwide. Carlyle has over 1100 investors in 61 countries.

1 Origin
2 Specialization
3 Current portfolio and major acquisitions
4 Past Acquisitions
5 Controversy
6 Notable current and former employees and affiliated persons
7 See also
8 References
9 Further reading
10 External links
- 10.1 Criticism

[edit] Origin

Carlyle was founded in 1987 by William E. Conway, Jr., Daniel A. D'Aniello, Stephen L. Norris, Greg A. Rosenbaum, and David M. Rubenstein^[2]. Rosenbaum left in 1987^[3]; Norris left in 1995^[4]. The three remaining founders are reported to collectively own around a 50% interest in the group's general partnership. The California Public Employees Retirement System (or CalPERS) is the only institution which owns a stake in the partnership, holding 5.5% of Carlyle.

As they wanted the firm to outlive them, the founders named the firm after the upper east side hotel in New York City, the Carlyle Hotel, where they first met to discuss the idea. Carlyle's current chairman is Lou Gerstner, former chairman and CEO of IBM and Nabisco.

[edit] Specialization

Carlyle deals in the following industries: Aerospace & Defense, Automotive, Consumer & Retail, Energy & Power, Healthcare, Real Estate, Technology & Business Services, Telecommunications & Media, and Transportation. The Carlyle Group's investments are focused on East Asia, Europe and North America, with most investment money coming from the United States (65%), Europe (25%), Asia (6%), Latin America, and the Middle East. Defense investments represent about 1% of the group's current portfolio^{[citation needed]} — though this translates, for example, into a 33.8% ownership of QinetiQ, the UK's recently privatized defence company.

[edit] Current portfolio and major acquisitions

Though known for its expertise in aerospace and defense, Carlyle invested more than thirty percent of its assets in the telecommunications and media sector. Noted portfolio companies are Dex Media, the former directories business of Qwest Communications; Willcom, a Japanese wireless company; Casema, a Dutch cable company; and Insight Communications, the ninth largest cable company in the U.S. The Carlyle Group is also a major investor in US Investigations Services, which is the privatized arm of the United States Office of Personnel Management's Office of Federal Investigations.

Brand-name companies that Carlyle owns include: Dunkin' Brands, which owns Dunkin' Donuts and Baskin-Robbins, and dental hygiene company Water Pik. Carlyle also recently took rental car company Hertz public.

On January 29 2007, Carlyle announced that it would acquire Synagro Technologies, Inc, which according to Synagro's website is "the largest recycler of biosolids and other organic residuals in the United States". The total enterprise value of the transaction, including the assumption of debt, is $772 million.^[5]

On June 28 2007, Carlyle announced that it would partner with Onex Corporation to buy the Allison Transmission unit from General Motors for $5.6 billion.^[6]

On July 2 2007, it was disclosed that the Carlyle Group was looking to buy Virgin Media UK cable business.^[7] Richard Branson is the largest shareholder, and the Virgin Group own the name Virgin, and Virgin Media have the rights to use the name Virgin for 10 years^{[citation needed]}.

On July 28 2007, Carlyle announced the acquisition of Applus from its shareholders Agbar, Union Fenosa and Caja Madrid for an enterprise value of €1,480 million.^[8]

On December 18 2007, David Rubenstein, representing the Carlyle Group, purchased the Magna Carta (one of seventeen copies) at Sotheby's Auction House in New York City. He paid the Perot Foundation $21.3 million. Mr. Rubenstein expressed his intent for it to be returned to the National Archives for display.

[edit] Past Acquisitions

Carlyle acquired United Defense Industries in October 1997, bringing in over 60% of Carlyle's defense business. United Defense went public on the New York Stock Exchange in December 2001 with Carlyle retaining a stock ownership position. Carlyle completed the sale of all of its United Defense stock and exited the investment in April 2004^[9]--in private equity terms, the investment was "realized" at that time.^[10] (One major United Defense program was the XM2001 Crusader self-propelled howitzer which was canceled by Secretary of Defense Donald Rumsfeld in early 2002 causing United Defense stock prices to fall 27 percent.^[11])

[edit] Controversy

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Please improve the article by adding references. See the talk page for details. (September 2007)

Critics of the Carlyle Group frequently note its connections to various political figures. Some of the sectors and companies in which it invests are highly sensitive to political activity; indeed, its actions may be viewed as a form of political arbitrage. This may create conflicts of interest when political decision makers have their own personal wealth [4] linked to such investments. Carlyle is the largest private equity firm located in Washington, D.C. - its corporate headquarters are located on Pennsylvania Avenue. Some have also linked Carlyle to some of lesser-known companies that have been linked to US Intelligence, such as Centre Analytics and In-Q-Tel.

In the book House of Bush, House of Saud, author Craig Unger states that Saudi Arabian interests have given $1.4 billion to firms connected to the Bush family. Nearly 85% of the $1.4 billion, or about $1.18 billion, refers to Saudi Arabian government contracts awarded to defense contractor BDM in the early to mid 1990s. Carlyle, however, sold its interest in BDM before former President George H. W. Bush joined as an advisor. Although, it should be noted that Bush family confidant James A. Baker was on the board when the interests were sold.^{[citation needed]}.

The Saudi Arabian relatives of Osama bin Laden were also investors in Carlyle until October 2001 when the family sold its $2.02 million investment back to the firm in light of the public controversy surrounding bin Laden’s family after the terrorist attack on September 11 2001. The bin Laden family has publicly disowned the al-Qaeda leader.[5] Osama bin Laden has no publicly known or acknowledged economic interest in Saudi Binladin Group (SBG), whose investments were in part managed by the Carlyle Group until the arrangement was terminated by mutual consent.

[edit] Notable current and former employees and affiliated persons

[edit] Business

G. Allen Andreas - Chairman of the Archer Daniels Midland Company
Daniel Akerson - company director
Joaquin Avila - investment banker
Laurent Beaudoin - CEO of Bombardier (1979-)
Paul Desmarais - Chairman of the Power Corporation of Canada
Arthur Levitt - former Chairman of the U.S. Securities and Exchange Commission
Karl Otto Pöhl - former President of the Bundesbank

[edit] Politics and public service

James Baker III, former United States Secretary of State under George H. W. Bush, Staff member under Ronald Reagan and George W. Bush, Carlyle Senior Counselor, served in this capacity from 1993 to 2005.
George H. W. Bush, former U.S. President, Senior Advisor to the Carlyle Asia Advisory Board from April 1998 to October 2003.
George W. Bush, current U.S. President. Was appointed in 1990 to the Board of Directors of one of Carlyle's first acquisitions, an airline food business called Caterair, which Carlyle eventually sold at a loss. Bush left the board in 1992 to run for Governor of Texas.
Frank C. Carlucci, former United States Secretary of Defense from 1987 to 1989; Also, former Princeton wrestling partner of former US Secretary of Defense, Donald Rumsfeld. Carlyle Chairman and Chairman Emeritus from 1989 to 2005.
Richard Darman, former Director of the U.S. Office of Management and Budget under George H. W. Bush, Senior Advisor and Managing Director of The Carlyle Group from 1993 to the present
Allan Gotlieb, Canadian ambassador to the United States (1981-89) and member of Carlyle's Canadian advisory board.
Liu Hong-Ru, former chairman of China's Securities Regulatory Commission
William Kennard, Chairman of the U.S. Federal Communications Commission (FCC) under President Bill Clinton, Carlyle's Managing Director in the Telecommunications & Media Group from 2001 to the present.
Arthur Levitt, Chairman of the U.S. Securities and Exchange Commission (SEC) under President Bill Clinton, Carlyle Senior Advisor from 2001 to the present
Peter Lougheed - Premier of Alberta (1971-85)
John Major, former British Prime Minister, Chairman, Carlyle Europe from 2002 until 2005
Frank McKenna, Canadian ambassador to the United States and former member of Carlyle's Canadian advisory board
Mack McLarty, White House Chief of Staff under President Bill Clinton, President of Kissinger McLarty Associates, Carlyle Senior Advisor from 2003 to the present
Anand Panyarachun, former Prime Minister of Thailand (twice), former member of the Carlyle Asia Advisory Board until the board was disbanded in 2004
Fidel V. Ramos, former president of the Philippines, Carlyle Asia Advisor Board Member until the board was disbanded in 2004
Dan Senor - political consultant
Thaksin Shinawatra, deposed Prime Minister of Thailand, former member of board, who resigned on taking office in 2001
Luis Téllez Kuenzler, Mexican economist, current Secretary of Communications and Transportation under the Calderon administration and former Secretary of Energy under the Zedillo administration.