[Mb-civic] Carlyle Group Explores Acquisition of Port Operations By Ben Hammer The Washington Business Journal

[Michael Butler]

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    Carlyle Group Explores Acquisition of Port Operations
    By Ben Hammer
    The Washington Business Journal

    Friday 10 March 2006

    Private equity firm The Carlyle Group established a team to acquire
public-purpose facilities such as ports a day after a United Arab Emirates
company said it would transfer newly acquired operations at American ports
to a U.S. organization.

    D.C.-based Carlyle Group announced an eight-person team would invest in
public-purpose infrastructure projects such as ports, transportation and
water facilities, airports, bridges and stadiums. The team will begin work
March 13.

    The new infrastructure team had been planned for six months, but the
Carlyle Group decided Thursday to launch it.

    DP World, a company owned by the United Arab Emirates, acquired a
British company that manages operations at six U.S. ports, but the House
Appropriations Committee voted 62-2 on March 8 to prevent it from taking
control of the ports.

    DP World will transfer the operations to a "U.S. entity," Sen. John
Warner, R-Va., said Thursday.

    The Carlyle Group, however, doesn't want to be that entity, says
spokesman Chris Ullman. "We have zero interest in that deal, and we will
continue to have no interest."

    Rep. Duncan Hunter, R-Calif., and others in Congress are considering
legislation that would block any foreign company from operating ports and
other key U.S. infrastructure. If that legislation is approved, it could
give The Carlyle Group and other private equity firms opportunities to buy
foreign-owned operations at a discount.

    The new public infrastructure investment group is co-headed by Robert
Dove, former executive vice president at Bechtel Enterprises, and Barry
Gold, former managing director and co-head of the structured finance group
at Citigroup/Salomon Smith Barney.

    "We are at a crossroads of the right market, right private equity firm
and right team with complementary skills and experience," Gold says in a
statement. "As a U.S. firm with exceptional experience in government
contracting, Carlyle is now well positioned to invest in U.S. and other
infrastructure either alone or as part of a consortium."

    Carlyle's infrastructure team will invest primarily in U.S.
infrastructure in transactions ranging from $100 million to more than $1
billion. It will enter into public-private partnerships with federal, state
and local governments by purchasing projects outright or through long-term
concessions.