The Carlyle Group’s fourth US buyout fund, Carlyle Partners (CP) IV, has received a two-year, fee-free term extension to exit two remaining investments, according to a report from the California Public Employees’ Retirement System (CalPERS).
The CalPERS document indicates that investors in the 2005-vintage fund, which closed on $7.85 billion, were asked to approve the extension to allow Carlyle to liquidate its remaining investments in aerospace hardware distributor and inventory management services provider Wesco Holding and embedded semiconductor designer NXP Semiconductor.
CP IV invested in portfolio companies between 2004 and 2007. Carlyle’s latest 10-Q filing with the SEC from 10 February shows that CP IV’s remaining fair value stood at $986 million at the end of 2015 with an unrealised multiple on invested capital (MOIC) of 1.3x. It was 97 percent invested.
The fund’s total investments had a fair value of $18.01 billion, MOIC of 2.4x and a 13 percent net internal rate of return, according to the 10-Q document. It listed NXP as the fifth largest publicly traded equity position for the firm, with a fourth-quarter 2015 value of $929 million.
Dutch company NXP is the result of its a merger with Freescale Semiconductor, which was acquired by NXP in December 2015. Carlyle initially bought Freescale on 1 December 2006 in a consortium of private equity buyers that included The Blackstone Group, Permira Advisors, TPG Capital and others.
According to NXP’s website, Carlyle owns 11 million shares, or 3.2 percent, of the company. Blackstone’s funds, which had co-invested in Freescale with Carlyle, own 33.3 million common shares, or 9.62 percent of the company, the filing said.
Carlyle acquired majority stakes in Wesco in September 2006, the firm’s website said. According to Wesco’s November 10-K filing with the SEC, it is obligated to pay Carlyle an annual management fee of $1 million plus fees and expenses, and incurred a $1.15 million expense in this regard for the year ended 30 September 2015.
Wesco shares’ closing price on 9 March was $13.71, down $2.99, or 18 percent, from its 52-week high of $16.70 in April. Its market capitalisation was $1.32 billion. NXP shares closed on $76.73 on 9 March, $37.27, or 33 percent, below the 52-week high of $114 in June. Its market capitalisation was $17.65 billion.
CP IV’s investor base includes CalPERS, the California State Teachers’ Retirement System, J. Paul Getty Trust, Florida State Board of Administration, Michigan State University, Pearl Holding Limited, Alpha Associates, Kuwait Fund for Arab Economic Development, and Partners Group, among others, according to PEI’s Research & Analytics division.
A spokeswoman for Carlyle could not be reached by press time.