As Carlyle megafund grows, so does number of agents, advisers pitching in

Carlyle Group has gotten an assist from nearly a dozen placement agents and advisers in reaching some $17 billion for its seventh core buyout fund, according to a regulatory filing.

The fund, the first to be invested under the leadership of Glenn Youngkin and Kewsong Lee, successors to Co-Founders William Conway, Daniel D’Aniello and David Rubenstein, is targeting $18.5 billion, up from an original target of $15 billion, according to Bloomberg.

Carlyle has its own fundraising team working on the fund. But also contributing have been nearly a dozen other companies from the U.S., Chile, South Korea and Israel — all described on the firm’s July 12 Form D/A as being “recipients” of sales commissions that total more than $16 million.

The numbers of recipients and sales commissions listed have grown over a series of Form Ds filed for the fund since November.

At least two of the listed firms are placement agents based outside the U.S.: Etgal Holdings of Israel and KB Investment of South Korea. One is a subsidiary of Carlyle itself: TCG Securities.

The other companies listed appear to be advisers, presumably bundling money for the fund from wealthy investors and possibly institutional investors.

They include Moneda SA, Administradora General de Fondos of Chile, Butterfield Asset Management Ltd of Bermuda; Merrill Lynch, Pierce, Fenner & Smith, a subsidiary of Bank of America North America Holding Co; HSBC of Hong Kong and Korea Investment & Securities of South Korea.

None of the firms listed provided comment on their roles in the fundraise, and an executive at Carlyle declined comment.

It’s not unusual for global megafunds to hire placements agents to help market their funds; agents might charge a fee of upward of 2 percent of new money raised.

Sources said it would be unusual for advisers to receive sales compensation for bundling investors into a megafund. According to fund attorneys, however, the fact that advisers are listed on a Form D as recipients of sales compensation doesn’t necessarily mean money changed hands.

Indeed, the size of the sales-commission tally suggests that Carlyle largely raised the fund on its own. The $16 million paid makes up barely 0.1 percent of the $17 billion fund.

Action Item: Review the July 12 Form D at https://goo.gl/h2if7Q