Unlocking Carlyle Funds: A Guide To Smart Investing

The Carlyle Group is a global investment firm with operations in private equity, alternative asset management, and financial services. As of 2023, the company had $426 billion of assets under management, investing in global private equity, global credit, and global investment solutions. Carlyle combines global vision with local insight and has a diverse and inclusive team of over 2,200 professionals operating from 29 offices across 4 continents. The firm operates four fund families, focusing on leveraged buyouts, venture and growth capital, real estate, and leveraged finance investments. It prefers to invest in various industries such as aerospace, government services, commercial products, consumer, media, retail, financial services, healthcare, infrastructure, industrial, technology, and transportation. Carlyle's common stock trades on the Nasdaq Global Select Market under the ticker symbol CG.

Carlyle's investment focus areas

Aerospace & Government Services

Carlyle has a history of investing in businesses related to the defense industry, including acquisitions in military electronics systems, military communications, and aircraft.

Consumer, Media & Retail

The company has a strong presence in this sector, with investments in various consumer-facing industries such as food and beverage, fashion, and entertainment.

Global Infrastructure

Carlyle's investments in this sector include companies involved in infrastructure development and management, such as telecommunications and energy.

Healthcare

The group has shown interest in healthcare-related investments, including pharmaceutical companies and healthcare technology.

Financial Services

Carlyle has a background in finance and has made investments in companies like McDonald's China and Money Square Holdings.

Technology

The company has invested in technology companies, including Ampere Computing Holdings and BiOligo Biotechnology.

Carlyle's investment strategy is guided by its global platform and local insights, allowing it to identify unique opportunities and cultivate resilient growth in industry leaders. The firm's deep industry expertise and diverse team enable it to create long-term value for its investors, companies, and communities.

The Carlyle Group's history

The Carlyle Group Inc. is an American multinational company founded in 1987 in Washington, D.C. It is one of the world's leading global investment firms, specialising in private equity, alternative asset management, and financial services. With nearly 2,200 employees in 28 to 29 offices on four continents, Carlyle has a global presence and a diverse range of investment vehicles.

Carlyle was founded as a boutique investment bank by five partners with backgrounds in finance and government: William E. Conway Jr., Stephen L. Norris, David Rubenstein, Daniel A. D'Aniello, and Greg Rosenbaum. The company was named after the Carlyle Hotel in New York City, where Norris and Rubenstein had planned the new business. The company began with $5 million in financial backing from various sources, including T. Rowe Price and the Richard King Mellon family.

In its early years, Carlyle pursued leveraged buyout investments and advised on significant transactions, such as a $500 million investment in Citigroup by a member of the Saudi royal family. Carlyle also developed a reputation for acquiring businesses related to the defence industry, including electronics divisions of General Dynamics Corporation and Magnavox.

In the early 2000s, Carlyle continued to grow and expand its portfolio, including notable acquisitions such as Hawaiian Telcom and The Hertz Corporation. The company also faced challenges, such as the collapse of Carlyle Capital Corporation in 2008 due to the global credit crunch.

In 2012, Carlyle completed a $700 million initial public offering and began trading on the NASDAQ stock exchange. The company has since made numerous acquisitions and investments, including in the technology, energy, and healthcare sectors. As of 2023, Carlyle had $426 billion of assets under management, making it one of the largest mega-funds in the world.

Carlyle's current CEO is Harvey Schwartz, who was appointed in February 2023. The company continues to focus on creating long-term value for its investors, partners, and communities through its diverse team and global reach.

The Group's investment process

The Carlyle Group's investment process is centred around value creation and impact. With a focus on long-term value, Carlyle combines a global vision with local insight, leveraging its global network and diverse team to deliver positive change.

Carlyle's investment process can be broken down into four key stages: sourcing, diligence, value creation, and exits.

Sourcing

Carlyle's investment opportunity set is constantly evaluated by its specialised investment teams, led by their thematic expertise. ESG and impact themes play an increasingly important role in this stage, with investors assessing opportunities through emerging growth markets, market disruptions, and changing consumer preferences.

Diligence

The due diligence stage is led by Carlyle's investment teams, with analysis and input from dedicated ESG experts and external partners. They focus on material ESG issues and value creation opportunities, integrating these considerations into the company's broader value creation plan.

Value Creation

Carlyle provides its portfolio companies with a global network and resources to support operational improvements, revenue growth, and geographic expansion. This includes capital injections, support from internal ESG professionals, connections to leading experts, and institutional knowledge.

Exits

Carlyle works with its companies to integrate, measure, and communicate their approach to ESG, as these characteristics are increasingly valued in investment exits. For example, their research has shown that increasing the share of renewable energy in an oil and gas company's revenue can lead to a significant increase in valuation multiples.

Carlyle's investment process is guided by its Global Portfolio Solutions (GPS) framework, which aims to drive a consistent and repeatable value creation process throughout the entire investment lifecycle.

The Group's investment partners

The Carlyle Group's investment partners include a range of portfolio companies, management teams, and fund investors. The Group's investment strategy focuses on specific industries where it believes its deep expertise provides a competitive advantage. These industries include aerospace, defence & government services, consumer & retail, energy, financial services, healthcare, industrial, real estate, technology, and transportation.

Carlyle's investment partners benefit from the Group's global platform and local insights, which help make better investment decisions and identify unique opportunities for growth. The Group's diverse and inclusive team of over 2,200 professionals across 29 offices in Asia-Pacific, Europe, North America, South America, and the UAE provides a broad range of resources and support to its partners.

Carlyle's investment partners further benefit from the Group's focus on value creation and impact, as well as its commitment to building lasting partnerships based on trust and credibility. The Group's scale and extensive reach allow it to deliver a truly global platform to its partners.

In addition, Carlyle's investment partners can leverage the Group's deep industry knowledge and expertise across its businesses. The Group's investment teams have partnered with world-class CEOs and founders to build market-leading and market-defining companies.

The Group's investment teams

The Carlyle Group's investment teams are committed to creating value in the markets where they live, work, and invest. With a presence in over 15 countries, Carlyle's investment team utilises its global platform and local insights to make informed investment decisions.

Carlyle's investment teams have a diverse and inclusive community of professionals that provide deeper insights and help outperform over the long term. The group's range of voices and perspectives enables them to ask better questions, find better answers, and build better businesses.

The investment teams at Carlyle have expertise across various industries, including aerospace, defence & government services, consumer & retail, energy, financial services, healthcare, industrial, real estate, technology, and transportation. They focus on identifying and creating growth opportunities within these industries, aiming to cultivate resilient growth, drive operational improvements, and support disruptive growth and geographic expansion.

Carlyle's investment teams also play a crucial role in the firm's Global Portfolio Solutions (GPS) framework, which guides and enables portfolio company management teams to strengthen operations, accelerate growth, and drive impact. By partnering with world-class CEOs and founders, Carlyle's investment teams have built market-leading and market-defining companies.

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