September 6, 2011

Private Equity Carlyle Group Going Public

$100 million IPO announcement comes on heels of Carlyle’s investment in Avalon Advisors

Traders on the floor of NYSE where the Carlyle Group will be listed. (Photo: AP) Traders on the floor of NYSE where the Carlyle Group will be listed. (Photo: AP)

Private equity giant The Carlyle Group filed Tuesday with the Securities and Exchange Commission to launch an initial public offering of common stock, with the goal of raising $100 million.

The Washington, D.C.-based Carlyle Group is one of the world’s largest multi-product global alternative asset management firms. Sometimes referred to as “the ex-presidents’ club” because of the number of former world leaders it employs, the Carlyle Group was founded in 1987 and has grown to approximately $153 billion in assets under management across 86 funds and 49 fund of funds vehicles.

The deal is unlikely to go to market soon considering the current volatility in the stock market. But when the IPO does launch, Carlyle, which will be listed on the New York Stock Exchange, will join the trend of buyout firms going public. Apollo Global Management went public in March and KKR & Co. went public in 2010 following the 2007 launches of Blackstone and Fortress.

According to the Carlyle Group’s S-1 filing with the SEC, the firm intends to use all of the IPO’s proceeds to buy newly issued partnership units from the holding company. The holding company will then use an undetermined sum to repay outstanding indebtedness and the remainder for general corporate purposes, including general operational needs, growth initiatives, acquisitions and strategic investments.

The S-1 filing says Carlyle Group has been “at the forefront of many recognized trends within our industry, including the diversification of investment products and asset classes, geographic expansion and raising strategic capital from institutional investors.”

On Aug. 31, the Carlyle Group made a name for itself in the world of financial advisors by announcing that it has made a minority investment in Avalon Advisors, a Houston-based wealth advisor and asset manager with nearly $4 billion in assets under management.

The investment in Avalon was made by Carlyle Global Financial Services Partners, a $1.1 billion fund that invests in a range of financial services companies.

The firm reported $2.8 billion in revenue and $1.5 billion in economic net income last year. That compares to Carlyle Group’s biggest competitor, the Blackstone Group, which reported $3.1 billion in revenue and $486 million in economic net income.

J.P. Morgan Securities, Citigroup Global Markets Inc. and Credit Suisse Securities USA will serve as joint book-running managers for the IPO, the firm said in a news release. 

Read Carlyle Group Buys Minority Stake in Avalon Advisors at AdvisorOne.com

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