NEW YORK (Reuters) – A Kuwaiti conglomerate is suing private equity firm Carlyle Group in a local court, alleging that it misrepresented the safety of affiliate Carlyle Capital Corp (CCC), a public debt fund that collapsed in 2008, the Financial Times reported on Monday.
The conglomerate, National Industries Group, invested $50 million in the fund, which was marketed to investors in other Carlyle funds as a safe fund that would invest largely in triple A mortgage-backed securities, the newspaper reported.
The debt fund, Carlyle Capital Corp, which was listed in Amsterdam, went bankrupt in March 2008 and liquidated its assets as it could not meet margin calls from its lenders. Carlyle Capital Corp mainly invested in mortgage-backed assets.
National Industries Group was not available for comment. Carlyle declined comment.
(Reporting by Megan Davies)