For The Carlyle Group and its peers, there are mounds of cash waiting to be deployed in 2015. Blackstone’s so-called dry powder stands at $42 billion, Apollo Global Management LLC’s is $34 billion and KKR’s is $18 billion. Carlyle’s is $56 billion.
Carlyle was the busiest private equity underwriter (PEU) in 2014. It will be interesting to see how Carlyle's energy investments do in the current era of $55 a barrel oil. Carlyle lost its mortgaged backed security fund in spring 2008 during a time of imploding real estate loans. It rolled up Blue Wave Partners, a hedge fund that same spring, at large losses for investors.
PEU's count on valuations cycling. They mine affiliates for cash via annual management fees, deal fees, added debt for dividends and then the final cash explosion, an IPO or sale of the firm.
It's interesting how many politicians cross back and forth from the PEU world. Those in office understand their role of servicing the greed and leverage boys. Dry powder must be deployed.
Thus industries must alternatively be stressed, then favored. Carlyle and company don't like mobilizing their cash hoards on high priced assets.