The Washington Post

Carlyle Groups’ 3 co-founders took home $750 million between them in 2013

The Carlyle Group’s three co-founders took home about
$750 million between them in 2013, mostly from their dividends in the private-equity firm and the gain they received from their investments.

The vast sums earned by Daniel D’Aniello, 67, William E. Conway Jr., 64, and David M. Rubenstein, 64, known in the firm as the “DBD” after their first initials, came from salary and stock dividends from their Carlyle holdings and payouts from investing personal money in the firm’s funds. They each received a $275,000 salary and did not receive bonuses.

Their payouts totaled $201 million for D’Aniello, $346 million for Conway and $202 million for Rubenstein.

Times are good for the private-equity business as it reaps fat gains on the sale of its investments, helped by a market fueled by low interest rates. All the major private-equity firms, which refer to themselves as asset managers as they expand beyond their traditional buyout business, enjoyed a robust 2013.

A large part of the owners’ take was the dividends they received on their Carlyle shares. The company’s 2013 dividend accounted for $93 million for each co-founder last year.

Another significant chunk of the Carlyle owners’ income resulted from rolling their own wealth back into deals that the firm makes, investing alongside customers such as sovereign wealth funds, pension funds and wealthy individuals.

Although the owners and their employees made healthy returns in 2013, they turned around and committed $1.1 billion in personal wealth to future deals.

For example, Conway’s personal investments, including the return on his initial investment plus capital gains, yielded $253 million last year, according to documents filed with the Securities and Exchange Commission. He then invested $207 million of that into Carlyle deals.

Carlyle’s rivals at KKR, Apollo Global Management and Blackstone have all reported big compensation hauls for their owners or are expected to report them in coming days.

Forbes estimates that each of Carlyle’s three co-founders is worth $2.6 billion. Rubenstein has given away $300 million of his fortune, much of it to what he calls “patriotic philanthropy” projects that include repairing the Washington Monument and permanently loaning a copy of the Magna Carta to the National Archives.

D’Aniello said this week said he is contributing $20 million to the right-leaning American Enterprise Institute. Conway last year committed $55 million to scholarships and other tuition assistance for nursing students at area universities and children at Catholic schools and to fund job training in Anacostia.

During the last quarter, Carlyle successfully sold its investments in railroads, cable operators, sportswear firms and a media ratings company.

Carlyle Group, founded in Washington in 1987, has $188.8 billion in assets under management.

Capital Business is The Post’s weekly publication focusing on the region’s business community.

Thomas Heath is a local business reporter and columnist, writing about entrepreneurs and various companies big and small in the Washington Metropolitan area. Previously, he wrote about the business of sports for The Post’s sports section for most of a decade.
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