Sunday, September 20, 2015

Carlyle Burned by Energy Prices

The Carlyle Group lists 28 current energy affiliates in its online portfolio.  Despite Carlyle co-founder David Rubenstein's preaching the attractiveness of energy investments, only one occurred this year.  Carlyle purchased Malaga Power in April.

Carlyle's 13F SEC filings show six publicly traded energy investments in their portfolio.  I looked at their value as of July 31, 2015 and compared it to July 31, 2014.  Carlyle took nearly a $1 billion paper loss on six companies.

ZeroHedge warned last week about a day of reckoning for energy producing companies.  Private equity is listed as a potential lifeline for struggling firms.  What if they're already in the PEU family?  Stay tuned...

Update 9-24-15:  DigitalEnergy noted private equity's interest in oil and gas plays.  They missed the bath Carlyle has taken on their public energy holdings.  ZeroHedge says restructuring is inevitable in the shale oil patch.

Update 9-27-15:  Bloomberg reported how oil shale junk debt is imploding and how debt holders are taking stock warrants with the hope of some future investment return.  Swaps are the name of the game in the U.S. shale rout.