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Carlyle facing Kuwait-based court case from LP National Industries Group

28 Aug 2012

Buyout giant Carlyle is facing a lawsuit from a Kuwaiti investment firm over allegations it sold a fund in 2006 without the required licence, it is understood.

National Industries Group lost out on its $25m investment in fixed-income fund Carlyle Capital Corp, which raised more than $1bn but collapsed in 2008 during the global financial crisis.

That crash came despite the vehicle, which was marketed as a safe fund, being primarily invested in government-backed AAA-rated mortgage securities.

The Kuwaiti firm is attempting to bring the case in its own country rather than in the US, where Carlyle says the case should take place under the contract between the two firms, according to Reuters.

It said NIG is calling the investment void because Carlyle did not have a securities licence to offer investment products in Kuwait.

NIG first filed a fraud suit against Carlyle in Kuwait three years ago, claiming the buyout house had misrepresented facts about the fund during marketing.

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