By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
IndebtaIndebta
  • Home
  • News
  • Banking
  • Credit Cards
  • Loans
  • Mortgage
  • Investing
  • Markets
    • Stocks
    • Commodities
    • Crypto
    • Forex
  • Videos
  • More
    • Finance
    • Dept Management
    • Small Business
9
Notification Show More
Videos
General Catalyst CEO: An AI driven power crisis lurks
2 hours ago
Videos
How AI-Generated Influencers Are Earning Millions
2 hours ago
News
OpenAI signs $30bn data centre deal with Oracle
3 hours ago
News
How Goldman Sachs won big in the Fed’s annual stress test
5 hours ago
News
On the streets with New York’s ‘rat tsar’
7 hours ago
News
Donald Trump presses Republican House dissidents to pass US tax bill
9 hours ago
News
Microsoft to cut 4 per cent of staff in new wave of lay-offs
10 hours ago
News
Donald Trump says US has struck trade deal with Vietnam
11 hours ago
News
Sean ‘Diddy’ Combs found guilty on two counts in prostitution trial
12 hours ago
Aa
IndebtaIndebta
Aa
  • Banking
  • Credit Cards
  • Loans
  • Dept Management
  • Mortgage
  • Markets
  • Investing
  • Small Business
  • Videos
  • Home
  • News
  • Banking
  • Credit Cards
  • Loans
  • Mortgage
  • Investing
  • Markets
    • Stocks
    • Commodities
    • Crypto
    • Forex
  • Videos
  • More
    • Finance
    • Dept Management
    • Small Business
Follow US
Indebta > News > Schwartz kicks off Carlyle tenure with lots of listening but no big ideas
News

Schwartz kicks off Carlyle tenure with lots of listening but no big ideas

News Room
Last updated: 2023/05/03 at 2:11 AM
By News Room
Share
6 Min Read
SHARE

Three weeks after taking the reins of Carlyle Group, Harvey Schwartz was holding court on the unfolding banking turmoil during an appearance in front of the private equity firm’s top dealmakers.

It was four days after Silicon Valley Bank had collapsed and the former Goldman Sachs president predicted the financial system was nowhere near a 2008-style crisis, according to people who attended the meeting. But he also warned his audience against complacency, urging them to be on the lookout for a sudden evaporation of confidence.

For Schwartz, a Goldman veteran who led the bank’s trading division through the great financial crisis, it was a chance to show Carlyle’s top brass how his Wall Street experience was relevant to an altogether different challenge: reviving a storied private equity group with $400bn in assets that has been twisting in the wind since the abrupt and acrimonious exit of his predecessor Kewsong Lee in August last year.

As Carlyle prepares to unveil its quarterly earnings on Thursday, its first results since Schwartz took over, insiders say the exchange of ideas via long talking and learning sessions has become the hallmark of his leadership style so far.

Analysts are not expecting Schwartz to announce a major restructuring this week or to unveil any big ideas on how to restore Carlyle to its former glory. Blackstone, Carlyle’s main rival in corporate buyouts when it went public in 2012, has since seen its market value eclipse $100bn. That makes it worth about 10 times as much as a company once seen as its equal.

“[We] expect early thoughts from new CEO Harvey Schwartz but no substantive commentary at this time,” said Michael Brown, an analyst who covers Carlyle at Keefe, Bruyette & Woods.

Schwartz has spent his first two-and-a-half months at the firm presenting himself as a keen listener, an image that runs somewhat counter to the reputation as a corporate bruiser he earned while at Goldman.

In addition to hosting roughly a dozen town halls, he has led forensic reviews of each of Carlyle’s businesses that have stretched on for two hours or more, during which he has peppered leaders with questions on strategy and performance.

“His message has very much been ‘help me help you’,” said one person involved in the meetings. Schwartz has also promised not to second guess the firm’s dealmakers on investments. Several insiders said the phrase “I’m not an investor” had become a common refrain. He was not on the investment committee of Carlyle’s flagship buyout funds, sources said.

Yet few think the listening sessions will last for much longer, with many insiders believing Schwartz is gathering the information he needs before embarking on a significant restructuring of the group.

The business reviews “are being received as interviewing for your job”, said one person briefed on the meetings. “He is direct and it is candid . . . He is asking a lot of questions. But he is not patronising everyone and being derogatory,” said another.

Multiple people familiar with Carlyle said they expected Schwartz to make dramatic changes that would integrate units that had long been run like independent fiefdoms, and to name a core leadership group responsible for the entire firm.

Schwartz must also decide which businesses, from credit to sustainable investments, can be expanded against a more challenging financial backdrop and which ones should be jettisoned.

He will also have to prevent the firm from bleeding talent, particularly dealmakers close to Lee and Peter Clare, another recently departed executive.

Externally, Schwartz has been trying to reassure the firm’s largest investors, including pension funds and sovereign wealth funds.

Meanwhile, Carlyle is still struggling to find the cash it needs to do new deals. Its latest buyout fund has raised just $14bn versus an initial target of $22bn set in 2021.

Some investors in its funds, known as limited partners, said they were becoming frustrated by how long the fundraising had dragged on and suggested that Carlyle should admit defeat by closing the fund early. “Write it off as a bad job and get on with investing it,” said one.

Not that spending the money will be particularly easy either. “In the investing environment broadly, I think this is one of the most complex times we’ve had,” Schwartz said at the Milken conference in Beverly Hills this week.

“Many of the trends that we lived with are slowing if not reversing . . . I think that sets up an incredibly interesting backdrop, both economically, globally and in terms of the opportunity set.”

Read the full article here

News Room May 3, 2023 May 3, 2023
Share this Article
Facebook Twitter Copy Link Print
Leave a comment Leave a comment

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Finance Weekly Newsletter

Join now for the latest news, tips, and analysis about personal finance, credit cards, dept management, and many more from our experts.
Join Now
General Catalyst CEO: An AI driven power crisis lurks

Watch full video on YouTube

How AI-Generated Influencers Are Earning Millions

Watch full video on YouTube

OpenAI signs $30bn data centre deal with Oracle

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects…

How Goldman Sachs won big in the Fed’s annual stress test

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects…

On the streets with New York’s ‘rat tsar’

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects…

- Advertisement -
Ad imageAd image

You Might Also Like

News

OpenAI signs $30bn data centre deal with Oracle

By News Room
News

How Goldman Sachs won big in the Fed’s annual stress test

By News Room
News

On the streets with New York’s ‘rat tsar’

By News Room
News

Donald Trump presses Republican House dissidents to pass US tax bill

By News Room
News

Microsoft to cut 4 per cent of staff in new wave of lay-offs

By News Room
News

Donald Trump says US has struck trade deal with Vietnam

By News Room
News

Sean ‘Diddy’ Combs found guilty on two counts in prostitution trial

By News Room
News

Tesla deliveries fall for second straight quarter

By News Room
Facebook Twitter Pinterest Youtube Instagram
Company
  • Privacy Policy
  • Terms & Conditions
  • Press Release
  • Contact
  • Advertisement
More Info
  • Newsletter
  • Market Data
  • Credit Cards
  • Videos

Sign Up For Free

Subscribe to our newsletter and don't miss out on our programs, webinars and trainings.

I have read and agree to the terms & conditions
Join Community

2023 © Indepta.com. All Rights Reserved.

Welcome Back!

Sign in to your account

Lost your password?