Bunch of buzz this morning about an FT report that The Carlyle Group is reconsidering its IPO prospects. Actually, more of the buzz might have to do with Carlyle’s denial when asked for comment by one of my Reuters colleagues. In an emailed statement, a spokesman wrote: “Carlyle has no plans to go public and if we ever do go public, it will be a long way off.”
A couple quick thoughts: (1) Carlyle has been tacitly considering going public for at least three years. In fact, I distinctly remember David Rubenstein giving a speech in which he compared mega-LBO partnerships to pre-public investment bank partnerships (and I haven’t seen him speak in a long while). So the idea that Carlyle continues to consider an IPO is about as newsworthy as Generalissimo Francisco Franco still being dead.
(2) If Carlyle were to file, the obvious comps would be Blackstone Group and KKR. In reality, however, Carlyle is a very different animal. Blackstone and KKR are both building investment management firms, with private equity as the large cornerstone. Blackstone has hedge fund, fund placement and advisory businesses in place. KKR has its capital markets effort, and wants more (according to its original IPO justification). Carlyle, on the other hand, is just private equity. Its hedge fund efforts crashed and burned, and it’s even pulled away from venture capital. In other words, the reason Carlyle needs cash right now is less obvious (save for brand equity and a recruiting perk).