Saturday, December 12, 2009

Carlyle Group's Verari Putters Out?


In 2004 The Carlyle Group invested in Verari Systems, a developer of blade server technology. Yesterday the firm showed telltale signs of implosion, locked doors, phones unanswered, and officials unwilling to make comments.

Should Verari officially enter bankruptcy, they'd join other imploded Carlyle ventures.

Carlyle Capital Corporation
BlueWave Partners
SemGroup
Hawaiian Telecom
Edscha
IMO Carwash
Stallion Oilfield Services
Verari Systems (?)
Who might be impacted by a Verari crash? A company press release cites well known customers. How many have warranties?

Virgin America, Morgan Stanley, Wachovia, Akamai, Microsoft, Qualcomm, Johns Hopkins, EMC, CGGVeritas, Petrobras, Harris, Lockheed Martin, Northrop Grumman, and Sony Imageworks, as well as top universities and research institutions worldwide

Did Verari run out of gas? Carlyle may soon have lots of fuel from two IPO's, China Pacific Insurance and Cobalt International Energy. Will they refill Verari's capital tank? Only if they pull into a Connecticut rest stop. That's a long way from San Diego.

Carlyle could lose $13.3 million in Series B equity financing, a pittance compared to billions in looming IPO proceeds.