Last night, at 10pm EST, Carlyle announced that its CEO is out.
Prior, Kewsong Lee, the now ousted CEO, was Co-CEOs with Glenn Youngkin. The two didn’t work as partners and Youngkin departed. Only now it seems perhaps Youngkin is having the last laugh, as he is now the elected Governor of Virginia.
Surely something bad went down. Perhaps some form of an affair? Perhaps violations of the divide between personal and corporate investments? Gotta be something fairly bad to eject a CEO who on the surface has appeared to be doing a great job.
Accordingly, the market does not like uncertainty:
The lesson here in my mind is when investing in single companies, things like this can happen that are well outside the realm of what one contemplates. While I don’t think, based on the press release, the business is impaired – that scenario is entirely possible in any single business. And that’s why prudent diversification is key to mitigating some of these tail risk events.
Disclosure: We do not own shares of CG, this is not investment advice. Do your own work.