Clayton, Dubilier & Rice isn't often mentioned in the same sentence as bigger rivals like Blackstone and KKR, but the New York-based firm has joined its peers in making major changes to its longstanding leadership.
On Thursday, the firm announced it has appointed Nate Sleeper as CEO, while David Novak and Rick Schnall will become co-presidents, effective January 1, 2020. Current CEO and chairman Donald Gogel will transition solely to his chairman role.
Gogel has been with CD&R for three decades, becoming president in 1995, CEO in 1998 and chairman in 2012 when co-founder Joseph Rice retired. The latest move will mark the firm's third leadership shakeup since it was founded in 1978, following the transition from founder Martin Dubilier to Rice, then Rice to Gogel.
Sleeper has been with CD&R for nearly 20 years and leads the firm's industrial investments division. Schnall joined in 1996, eventually assuming control of CD&R's healthcare investment and growth investing activities. And Novak joined a year later and works in London leading the buyout shop's European division. The trio will join Gogel on a new executive committee dedicated to governance-related issues, while remaining on an investment committee with vice chairman Kevin Conway.
With founders of major private equity shops reaching retirement age, the past few years have featured a handful of firms announcing succession plans. In February 2018, Blackstone named then-real estate head Jon Gray as the firm's president and COO, replacing Tony James. The move essentially set Gray up to become the successor to Blackstone founder Stephen Schwarzman, who turned 72 in February.
The shift at Blackstone came shortly after Carlyle Group co-founders David Rubenstein and William Conway stepped down as co-chief executives, with Kewsong Lee and Glenn Youngkin filling their roles. At KKR, Joseph Bae and Scott Nuttall took over for founders Henry Kravis and George Roberts.
In the meantime, expect CD&R to continue investing out of a record flagship vehicle, which closed on $10 billion in 2017. The firm struck a deal earlier this month to invest $150 million in fast-casual pizza chain MOD Pizza, marking its third completed deal of 2019 and the second out of Fund X, according to PitchBook data.
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