Carlyle scales back credit vehicle IPO

Carlyle Capital Corporation announced a reduction in the scope of its planned Euronext IPO in reaction to volatility in the subprime loan market.

Carlyle Capital Corporation, a Guernsey-based affiliate of The Carlyle Group announced that it plans to reduce the scope of its planned IPO on the Euronext.

The IPO was initially announced the week before last. Late last week, CCC said it would reduce the size of the offering from $400 million to $300 million. The firm has also repriced the shares, from a range of $20 to $22 per share to $19 per share. The date of the IPO has also been delayed, and is now expected some time next week.

The firm has already raised $600 million in a private placement. The company decided that a reduction its public offering would be prudent in light of what chief executive officer John Stomber has termed, in a Reuters interview, “headwinds” in the credit and debt markets.

Chris Ullman, Carlyle’s company spokesman, said that although the firm invests in high-grade, AAA-rated mortgage-backed securities, CCC is confronting “headwinds” in the debt and credit markets due to volatility in the subprime lending market.

He described the recently proposed legislation that would raise tax rates on private equity firms’ capital gains, as well as the unexpected drop in The Blackstone Group’s share price the third day after its IPO, as “totally unrelated.”