Carlyle Group was not the only private equity group that was the target of allegations of price fixing, but it was the last man standing when it came to willingness to go to court and not to settle … until now. Carlyle is paying $115 million to avoid a trial, a similar amount to that paid by Blackstone. Carlyle management insists that its willingness to settle should in no way be construed to be an admission of wrongdoing.
Bain Capital, KKR, Silver Lake Partners, TPG and Goldman Sachs made similar settlements when faced with the likelihood of a trial over price fixing and attempts by those involved in deals to manipulate and lessen competition for assets. The settlement came just days before a decision whether or not the case could rise into a class action suit, in which case, Carlyle was facing the possibility of owing plaintiffs as much as $10 billion.
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The case was connected to questionable emails dating from 2007 over the largest leveraged buyout on record, the purchase of HCA hospital group by Bain Capital, KKR and Merrill Lynch. Co-founder of Carlyle, David Rubenstein, when asked about competition with KKR, said “I don’t want to get in a pissing battle with KKR at the same time we are teaming up on other deals.” Meanwhile, the $325 million in settlements Blackstone, KKR and TPG agreed to pay await court approval.