Unions spoil private equity party

Power to the people? One of private equity's leading lights has been given a roasting in the US...

Last Updated: 31 Aug 2010

David Rubenstein, head of US buyout firm The Carlyle Group, had just taken to the stage for his keynote address at the Wharton Private Equity Conference in Philadelphia, when a gang of protesters from the US-based Service Employees International Union stormed the stage unfurling banners, chanting slogans and generally giving the speaker an earful.

Rubenstein will be getting used to this; it’s the latest of several public demonstrations by the SEIU against Carlyle’s recent $6.3bn acquisition of nursing home group Manor Care. The unionists handed out a flier saying: ‘Carlyle billionaire David Rubenstein talks about the ‘winds of change’ in our economy, but what is he really blowing… Super rich chief executives like David Rubenstein are blowing off our communities in their relentless drive to get even richer.’ It also criticised him for Manor Care’s track record – which seems a bit harsh given that Carlyle has only owned the business for ten minutes.

According to some reports, the absence of any security meant the confrontation sparked a bit of a melee. Doing its bit for Gallic relations, US website Dealbreaker said excitedly that there was ‘pushing, shoving, punching – everywhere… It’s like – France!’ That’ll teach him to go on holiday with England football fans.

The site also reported that the normally genial Rubenstein got rather irate with his uninvited guests, suggesting to one to ‘take a remedial course in English before you go any further’.

One thing’s for sure – trade unions on both sides of the Atlantic have clearly realised that they can make some serious waves by taking the fight to private equity firms directly. And the likes of Rubenstein are increasingly aware that dealing with union brickbats is now part of the job description. A couple of years ago, he could probably have walked through the crowd unnoticed – suddenly he’s public enemy number one.

And since the unions always seem to come up with the best quotes, it’s going to be a tough fight for private equity to win...

Watch out for our special feature on a big year for private equity, in the February issue of MT.

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