The Carlyle Group took a significant minority stake in Entertainment 360, which is behind Game of Thrones and other productions. It did so through Carlyle Credit Opportunities which offers:
privately-negotiated debt and capital solutions partnering with high-quality sponsors and leading family or entrepreneur-owned companies.Private credit has been marketed as "low risk" and "relatively safe." Carlyle Capital Corporation investors were told similar things before that highly leveraged mortgage backed securities vehicle collapsed in March 2008. Carlyle's legendary founders distanced themselves from that financial corpse before tapping TARP funds for other affiliates and garnering a massive FDIC subsidy for BankUnited. Enough sordid financial history.
Bloomberg reported on another Carlyle Credit Opportunities loan gone bad.
It seemed like a low-risk bet when in 2020 Carlyle Group Inc. agreed to provide around €200 million ($210 million) in private bonds to Pro-Gest SpA, a family-owned paper and packaging company based near Venice.Carlyle's loan took priority over other Pro-Gest debt, which the firm defaulted on in June 2024. The company is in court supervised negotiations with its various lenders. A forensic financial analysis report by Deloitte indicated:
...founder Bruno Zago and other members of his family may have used company funds to pay for non-business-related expenses....€1.4 million purchase of a Ferretti Custom Line 94 yacht, and zero-interest loans to several Zago family members and close allies, some of which weren’t paid backZago family members allegedly used company funds to pay for aircraft rentals for purposes not related to Pro-Gest’s core business, and to cover about €530,000 in yacht maintenance costs between 2021 and 2024...expenses questioned included payments for a yacht and cash used to fund a prosecco winery.
What can Entertainment 360 do with this story line? Tryion Lannister vs. Bruno Zago...that may be why Carlyle made it's significant minority investment. With crisis comes opportunity.
