Carlyle raises $13 billion for U.S. private equity fund


By Greg Roumeliotis

Nov 25 (Reuters) - Carlyle Group LP said on Monday ithas finished raising money for its latest U.S. private equityfund, surpassing its initial $10 billion fundraising target by$3 billion.

The Washington, D.C.-based company, founded in 1987 by DavidRubenstein, William Conway and Daniel D'Aniello, said the $13billion Carlyle Partners VI fund attracted 269 investors from 43countries. Carlyle and its staff invested $1 billion in the fundalongside $12 billion from outside investors.

Carlyle, which has diversified into other assets classesincluding corporate credit, real estate and hedge funds, had$185 billion in assets under management at the end of September,with $62.2 billion in private equity.

Nevertheless, private equity accounts for more than one-halfof its profits. Out of the $627 million in Carlyle's 12-monthdistributable earnings to the end of September, $325 millioncame from private equity.

Its previous U.S. buyout fund, Carlyle Partners V, wasvalued at 1.6 times its investors' money at the end ofSeptember. It raised $13.7 billion from investors at the onsetof the latest financial crisis in 2008.

Carlyle's latest U.S. buyout fund comes amid a widerrecovery in private equity fundraising, as investors look foryield amid record low interest rates. Buyout funds raised atotal of $124.5 billion globally in the first nine months of2013, up from $82.5 billion in the same period in 2012,according to Thomson Reuters data.

Some of the major private equity funds raised this yearinclude a $11.2 billion pool by Warburg Pincus LLC fordeals around the world, and KKR & Co LP's latest NorthAmerican private equity fund, which is wrapping up fundraisingat more than $8.3 billion.

Private equity funds dedicated to the United States,however, may find it more challenging to put money to work inthe short term as red-hot equity and debt markets have buoyedthe price expectations of sellers and tempered leveraged buyoutvolumes.

Private equity-backed deals, excluding the mega buyouts ofDell Inc and Heinz that involved minority participation fromprivate equity, totaled $131.8 billion in the United States yearto date, less than the $137.2 billion over the same period lastyear but above the $105.5 billion over the corresponding periodin 2011, according to Thomson Reuters data.

In response, Carlyle has been trying to source more deals ona proprietary basis. In September it agreed to invest $500million for a minority stake in Beats Electronics LLC, a makerof headphones founded by rapper Dr. Dre and music producer JimmyIovine.

It has also stepped up efforts to attract top talent,poaching veteran dealmaker Kewsong Lee from Warburg Pincus andnaming him deputy chief investment officer earlier this month.That may position him to succeed one of Carlyle's founders inthe future.

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