Carlyle Group Inc said its CEO Kewsong Lee has stepped down, a setback to the private equity giant’s bid to navigate a generational transition during a period of market turbulence.
His sudden exit, announced late on Sunday, reverses a changing of the guard set in motion just five years ago when Carlyle’s founders ceded leadership duties to a new pair of co-CEOs. That arrangement did not last.
Lee, 56, became the sole boss in September 2020 after a power tussle that led to co-CEO Glenn Youngkin leaving.
Photo: Reuters
Lee’s exit has come as a surprise to many executives. With his five-year employment agreement due to expire at the end of the year, Lee and board directors clashed over his contract in recent discussions, a person familiar with the matter said.
Carlyle cofounder Bill Conway, current non-executive co-chairman, will step in as interim CEO during the search for a successor, the company said in a statement.
At the start of this year, Carlyle bumped Lee’s base salary more than threefold to US$1 million.
For all of the private equity industry’s attempts to tout its prowess at fixing and reshaping companies, many firms have struggled to navigate a smooth transfer of leadership and shake off the hallmarks of their founders.
Lee had been trying to diversify revenues, make profits less tied to markets’ boom-and-bust cycles and lift Carlyle’s stock price. That task is needed more than ever, with volatile markets making it harder to take companies public or sell them at high prices.
In his aggressive attempts to remake the firm, Lee — a former Warburg Pincus dealmaker who joined Carlyle in 2013 — made changes that at times put him at odds with the old guard. He tried to knit competing factions and restructure teams to make dealmakers work more closely together. He also staffed the top ranks with new faces and tried to shift the Washington-based firm’s power center toward New York.
Shares of Carlyle dropped 31 percent this year, underperforming rivals including Blackstone Inc and Apollo Global Management Inc.
Carlyle posted a 34 percent increase in distributable earnings in the second quarter, as it grew its credit business and boosted fee streams.
Still, Lee said at the time that the industry faces an uncertain environment as the US Federal Reserve moves to raise interest rates and tackle inflation. Valuations need to reset before deal activity picks up across the industry, he said.
A newly formed search committee is searching for a permanent successor, Carlyle said.
The company also formed a CEO office to assist Conway and make a “seamless transition” once a replacement has been identified.
EXTRATERRITORIAL REACH: China extended its legal jurisdiction to ban some dual-use goods of Chinese origin from being sold to the US, even by third countries Beijing has set out to extend its domestic laws across international borders with a ban on selling some goods to the US that applies to companies both inside and outside China. The new export control rules are China’s first attempt to replicate the extraterritorial reach of US and European sanctions by covering Chinese products or goods with Chinese parts in them. In an announcement this week, China declared it is banning the sale of dual-use items to the US military and also the export to the US of materials such as gallium and germanium. Companies and people overseas would be subject to
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) founder Morris Chang (張忠謀) yesterday said that Intel Corp would find itself in the same predicament as it did four years ago if its board does not come up with a core business strategy. Chang made the remarks in response to reporters’ questions about the ailing US chipmaker, once an archrival of TSMC, during a news conference in Taipei for the launch of the second volume of his autobiography. Intel unexpectedly announced the immediate retirement of former chief executive officer Pat Gelsinger last week, ending his nearly four-year tenure and ending his attempts to revive the
WORLD DOMINATION: TSMC’s lead over second-placed Samsung has grown as the latter faces increased Chinese competition and the end of clients’ product life cycles Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) retained the No. 1 title in the global pure-play wafer foundry business in the third quarter of this year, seeing its market share growing to 64.9 percent to leave South Korea’s Samsung Electronics Co, the No. 2 supplier, further behind, Taipei-based TrendForce Corp (集邦科技) said in a report. TSMC posted US$23.53 billion in sales in the July-September period, up 13.0 percent from a quarter earlier, which boosted its market share to 64.9 percent, up from 62.3 percent in the second quarter, the report issued on Monday last week showed. TSMC benefited from the debut of flagship
TENSE TIMES: Formosa Plastics sees uncertainty surrounding the incoming Trump administration in the US, geopolitical tensions and China’s faltering economy Formosa Plastics Group (台塑集團), Taiwan’s largest industrial conglomerate, yesterday posted overall revenue of NT$118.61 billion (US$3.66 billion) for last month, marking a 7.2 percent rise from October, but a 2.5 percent fall from one year earlier. The group has mixed views about its business outlook for the current quarter and beyond, as uncertainty builds over the US power transition and geopolitical tensions. Formosa Plastics Corp (台灣塑膠), a vertically integrated supplier of plastic resins and petrochemicals, reported a monthly uptick of 15.3 percent in its revenue to NT$18.15 billion, as Typhoon Kong-rey postponed partial shipments slated for October and last month, it said. The
RSS