Carlyle plans E3bn European fund

The US buyout firm is to firm up its commitment to the European buyout market with the launch of a new E3bn dedicated fund.

The Carlyle Group, the US private equity house which has raised in excess of $13bn since it was launched in 1986, is planning to launch a fund targeting European buyouts.

The firm, which was yesterday confirmed as the Ministry of Defence’s preferred bidder for the acquisition of a 51 per cent stake in UK research and technology institute QinetiQ, wants to raise E3bn for investments in European industry, reports the Financial Times.

Carlyle has been among the more active private equity managers recently. In addition to the QintetiQ deal, the firm recently completed the second-largest LBO in history, teaming up with Welsh Carson Anderson & Stowe to acquire the US telephone directories business of Qwest Communications in a $7bn transaction.

If the fundraising is successful, Carlyle will join a growing list of firm’s raising multi-billion dollar funds. 2002 has seen the closing of a number of mega-funds, including Cinven’s Third Fund, which closed at E4.3bn and the Candover 2001 Fund, which held a final closing at E2.7bn earlier this year. Other large vehicles currently in the market include Charterhouse Development Capital's E3.5bn seventh fund, Terra Firma's debut fund and 3i's latest buyout fund, which is looking to raise E1.5bn and match it with the same amount of balance sheet money.

Carlyle already has an early stage investment fund dedicated to Europe. Earlier this year the E732m Europe Venture Fund, was trimmed back to E650m in the light of lower valuations and fewer investment opportunities.