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GLOBAL - Carlyle to change terms on its fifth fund

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It is understood that Carlyle Group is the latest private equity firm to appease its investors by agreeing to several changes to terms on its fifth fund, Carlyle Partners V, including a split on transaction fees, limits on the amount of debt investments and limits on the amount of capital to be invested in 2010 and 2011.

According to reports, Carlyle sent a letter to its investors last month stating that the firm would invest no more than 35% of the fund's total committed capital in 2010 and no more than 70% in 2010 and 2011 combined.

The firm also said that the limit of total aggregate debt purchases from the fund would be 25% of the vehicle's committed capital. Carlyle can however exceed this limit if it is to purchase debt in it's own portfolio companies for 'defensive purposes'.

The percentage of deal fees which are to be returned to LPs is said to have increased from 65% to 80%. There is, however, no talk to decrease the fund's size from its current $13.7bn.

LPs have until Thursday to raise any complaints to the proposed changes.

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