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Wednesday, 15 June 2011

Carlyle, the new EM cheerleader | beyondbrics –

Forget higher interest rates and inflation fears. Emerging markets are still hot properties. The proof? Carlyle, the US private equity group, has just sealed a deal to acquire a 55 per cent stake in Emerging Sovereign Group, the EM specialist hedge fund that has $1.6bn under management.

The specific terms of the deal were not disclosed. All Carlyle would say is that in return for giving up the 55 per cent stake, the owners of ESG will receive a mix of cash, stock in Carlyle and performance related payouts.

Cynics may argue out that, with profits from leveraged buyouts on the wane, Carlyle’s move into emerging markets is no more than a diversification attempt to appear more attractive to potential shareholders ahead of a planned initial public offering later this year.