Tuesday, December 8, 2009

PEU's Offensive Leverage Returns

Fortune interviewed Carlyle Group's Sandra Horbach, head of the private equity underwriter's consumer and retail group. She said:

We’re seeing multi-billion deals with high levels of leverage, at attractive rates. We’re back in business. We’re excited about playing offense again.
Carlyle recently announced a $350 million borrowing on Booz, Allen, Hamilton. Proceeds will pay investor dividends. That sounds offensive given the various Carlyle bankruptcies and debt cram downs.

Is it the kind of offensive leverage that bankrupted Carlyle Capital Corporation, BlueWave Partners, Semgroup, Hawaiian Telecom, Edscha, IMO Carwash, and Stallion Oilfield Services? Systemic risk anyone? Which Carlyle affiliate will fail next?