The Carlyle Group has bought a majority stake in mutual fund and hedge fund manager TCW Group.
Terms of the deal were not disclosed, although media reports indicate a price tag of about $700 million and current owner Société Générale wrote down the value of its stake in the firm by €200 million earlier this month. TCW’s current management and employees put up enough money to boost their stake to 40% of the company; the remainder will be owned by two Carlyle funds—not by Carlyle itself; TCW is not being merged into the private equity giant.
TCW has $127 billion in assets under management. SocGen bought half of the Los Angeles-based money manager in 2001 and eventually owned 85% of the firm.
“TCW is a premier global asset manager that will become even stronger as a free-standing company with increased employee ownership,” Carlyle’s Olivier Sarkozy said.
That free-standing company will be run by David Lippman, currently head of fixed-income at TCW. Current CEO Marc Stern will become chairman of the board of directors.
“I am particularly pleased that we will materially increase employee ownership of TCW—a transformative change that will even more closely align our interests with those of our clients,” Stern said.