Carlyle Group Loses Another Executive. What Wall Street Is Saying.

Carlyle Group stock rose alongside broader markets Wednesday, despite leadership changes.

Keith Bedford/REUTERS/Alamy

Management changes at

Carlyle Group

continued Wednesday, as the company said another high-ranking executive is leaving, just days after the sudden departure of its CEO. But shares still rose along with the broader market, after a key indicator showed a slowdown in inflation.

Nathan Urquhart, a managing director-partner and global head of investor relations, is leaving Carlyle (ticker: CG) at the end of the year to pursue new professional opportunities, according to a Wednesday news release from the firm. Urquhart is a member of Carlyle’s leadership and operating committees. Urquhart’s departure has been in the works for months and has nothing to do with the resignation of CEO Kewsong


a person familiar with the situation said.

On Sunday, the private-equity firm surprised many by announcing that Lee would step down immediately. The firm didn’t provide a reason for the departure. Lee’s five-year contract with Carlyle was scheduled to come to an end at the end of 2022, the person said. The Financial Times reported Wednesday that Lee had asked for a pay package worth $300 million over five years and resigned when Carlyle’s co-founders wouldn’t consider it.

In coming months, Urquhart will join Coatue Management, where he will be part of the hedge fund’s leadership team, as well as oversee investor relations and fundraising efforts for the firm, another person familiar with the situation said. 

Carlyle has tapped David McCann, a managing director-partner and senior relationship manager responsible for overseeing its investor relations in North America, to serve as interim global head of IR, effective Aug. 10, the statement said. 

Stocks shot higher Wednesday, after the consumer price index stayed flat in July from a month earlier and decelerated to an 8.5% annual pace. Carlyle stock, which is down about 36% this year, gained about 4% to close at $35.35. Shares of rivals Blackstone (BX) and


were each up 7%, while

Apollo Global Management

(APO) rose about 4% in the afternoon.

Lee’s exit appears to be having a short-term impact on the stock, which has dropped about 7% since Sunday. Gerald O’Hara, a Jefferies analyst, cited the recent management transition as one reason for cutting his rating on Carlyle shares to Hold from Buy on Tuesday. He also reduced his price target to $38 from $50.

“Lee’s departure in the final year of his contract comes as a surprise and leaves us with questions regarding the transition strategy and growth trajectory,” O’Hara said in an Aug. 9 note. 

Carlyle’s board, led by co-founder and now interim CEO Bill Conway, will hire an executive search firm immediately to find and assess candidates, according to Carlyle’s Aug. 7 release. Lee will also be available to assist Carlyle in a transition during the months ahead, the statement said.

However, the search for a new CEO could realistically take several months, if not quarters, O’Hara said. “We also note CG has a unique culture and will likely be forced to pay competitive pricing to attract the right individual,” O’Hara said in the note. 

Glenn Schorr, an analyst with Evercore ISI, said there is no established heir apparent at Carlyle since its co-founders have all moved on, according to an Aug. 8 note. However, he is “pretty confident” there is a long list of very talented leaders and investment professionals that “would love to step into this role,” he wrote. He retained his Outperform rating for the stock and a $45 price target. 

Rufus Hone, an analyst with BMO Capital Markets, said in an August 8 note that he expects Lee’s departure to have minimal impact on Carlyle’s day-to-day operations,  and that the firm’s strategy won’t change in the near-term under Conway. The biggest impact will be around investor sentiment toward Carlyle, which may struggle to “improve meaningfully (at least relative to peers) until a replacement is named and investors gain greater certainty around the new CEO’s longer-term strategy,” Hone said in the note. He expects modest change at most from a new CEO.

Hone doesn’t expect Lee’s departure to slow down Carlyle’s fundraising plans, either. Carlyle is currently in the market for its eighth flagship buyout fund, which is targeting $22 billion. Hone’s Outperform rating for the stock and a $59 price target were unchanged.

Write to Luisa Beltran at

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