Carlyle’s move is rare in an industry where succession plans are not usually revealed © Reuters
Kewsong Lee and Glenn Youngkin have been appointed as co-chief executive officers, while Peter Clare will become co-chief investment officer alongside one of the founders.
Rumoured in recent years to be likely successors of the founders, all three will join the company’s board of directors.
The trio, all men in their 50s, will also run the day-to-day operations of the business, including handling conference calls with investors, daily operations, strategy and fundraising, which means the founders will be handing over the reins of the group from January 1 next year.
However, the co-founders of the business are not likely to fade away, as they continue to retain roles in the group.
Current co-chief executives David Rubenstein and Bill Conway, both 68, will relinquish their existing positions and become co-executive chairmen of the board, the company is expected to announce. They will both continue to be members of Carlyle’s executive group.
Mr Conway will continue in his role as co-chief investment officer. Separately, Daniel D’Aniello, 71, will relinquish his role as chairman and will become chairman emeritus. Mr D’Aniello will continue to be on Carlyle’s board and executive group.
The new appointees have been groomed for years by the founders and the succession planning has been in the works at Carlyle for months, according to people familiar with the plan.
David Rubenstein, right, and Bill Conway, left, are set to give up their chief executive roles while Daniel D’Aniello, centre, will relinquish his chairmanship © Getty
The promotions follow a similar move by KKR, the US buyout group, which in the summer elevated two executives to leadership roles.
While KKR positioned these roles as potentially succeeding the founders as chief executives, Carlyle is actually giving the new co-CEOs leading and full responsibility of the running of the company, people familiar with the appointments said.
KKR said at the time of the appointments of Scott Nuttall and Joseph Bae as co-chief executives that they were “about the future” as it looked to build “the right team”.
Carlyle is expected to say in a statement that Mr Lee and Mr Youngkin will have “full responsibility, authority and accountability for the firm’s performance”.
Only a few people know internally at Carlyle about the promotions and crucial investors have been notified of the move, the people said.
Mr Lee will focus on the company’s corporate private equity and global credit businesses, as well as corporate strategy and development, and capital markets.
Mr Youngkin will oversee Carlyle’s real estate, energy and infrastructure businesses, the investment solutions segment as well as investor relations and external affairs. They will both continue to serve on the investment committees in their respective areas of focus.
The promotions were timed to coincide with Carlyle disposing of its poorly performing hedge fund businesses and after a group of company executives, including Mr Conway, were exonerated in a case linked to their decisions during the financial crisis. Carlyle is set to emphasise that it has cleaned up its act and it is offering a clean sheet to the new co-CEOs, people familiar with the thinking behind the appointments said.
The promotions also come at a time when the company has performed well. Over the summer it posted better than expected results and it is reporting quarterly earnings in the next few days.
The move is likely to add extra pressure on their listed rivals in the US as investors in private equity raise concerns over who is taking control of these fundraising houses with 12 per cent of funds set to close in less than a decade.
More recently private equity investors — which typically include pension funds and sovereign wealth funds — have been cutting back on under-performing managers, which only adds to the pressure to set out a clear succession plan.