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Investments | 3 Months Ended
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Mar. 31, 2017
Equity Method Investments and Joint Ventures [Abstract] |
Investments | Investments Investments consist of the following:
| As of
| March 31, 2017 |  | December 31, 2016
| (Dollars in millions)
Equity method investments, excluding accrued performance fees | $ | 1,009.6 |  |  | $ | 950.9 |
Investments in CLOs and other | 159.4 |  |  | 156.1 |
Total investments | $ | 1,169.0 |  |  | $ | 1,107.0 |
Strategic Investment in NGP In December 2012, the Partnership entered into an agreement with ECM Capital, L.P. (“ECM”) and Barclays Natural Resource Investments, a division of Barclays Bank PLC (“BNRI”), to make an investment in NGP Management Company, L.L.C. (“NGP Management” and, together with its affiliates, “NGP”), an Irving, Texas-based energy investor. The agreement was amended in March 2017 to further align the interests of the Partnership and NGP. The Partnership’s equity interests in NGP Management entitle the Partnership to an allocation of income equal to 55.0% of the management fee-related revenues of the NGP entities that serve as the advisors to certain private equity funds, and future interests in the general partners of certain future carry funds advised by NGP that entitle the Partnership to an allocation of income equal to 47.5% of the carried interest received by such fund general partners. In consideration for these interests, the Partnership paid an aggregate of $504.6 million in cash to ECM and BNRI, and issued 996,572 Carlyle Holdings partnership units to ECM that vest ratably through 2017. In January 2016, the Partnership also paid contingent consideration to BNRI of $183.0 million, of which $63.0 million was paid in cash and $120.0 million was paid by a six year promissory note issued by the Partnership (see Note 7). The transaction also included contingent consideration payable to ECM comprised of up to $45.0 million in cash (of which $22.5 million was paid in March 2017 with the balance payable in January 2018), together with up to $15.0 million in Carlyle Holdings partnership units or cash, which is payable in January 2018, and 597,944 Carlyle Holdings partnership units that were issued in December 2012 and substantially vested upon the amendment in March 2017. The Partnership has also agreed to issue common units on each of February 1, 2018, 2019, and 2020, with a value of $10.0 million per year to an affiliate of NGP Management, and subsequent to 2020, to issue common units on an annual basis with a value not to exceed $10.0 million per year based on a prescribed formula, which will vest over a 42-month period. The Partnership has the right to purchase the remaining equity interests in NGP Management in specific remote situations designed to protect the Partnership's interest. The Partnership accounts for its investments in NGP under the equity method of accounting. The Partnership recorded its investments in NGP initially at cost, excluding any elements in the transaction that were deemed to be compensatory arrangements to NGP personnel. The Carlyle Holdings partnership units issued in the transaction, the contingently issuable Carlyle Holdings partnership units, and the deferred restricted common units (which were granted in 2012 to certain NGP personnel) were deemed to be compensatory arrangements; these elements are recognized as an expense under applicable U.S. GAAP. The Partnership records investment income (loss) for its equity income allocation from NGP management fees and performance fees, and also records its share of any allocated expenses from NGP Management, expenses associated with the compensatory elements of the transaction, and the amortization of the basis differences related to the definitive-lived identifiable intangible assets of NGP Management. The net investment earnings (loss) recognized in the Partnership’s condensed consolidated statements of operations for the three months ended March 31, 2017 and 2016 were as follows:
| Three Months Ended March 31,
| 2017 |  | 2016
| (Dollars in millions)
Management fees | $ | 17.6 |  |  | $ | 20.7 |
Performance fees | 35.6 |  |  | — |
Investment income (loss) | 4.0 |  |  | (1.5 | )
Expenses | (26.0 | ) |  | (3.6 | )
Amortization of basis differences | (2.1 | ) |  | (13.8 | )
Net investment income | $ | 29.1 |  |  | $ | 1.8 |
The difference between the Partnership’s remaining carrying value of its investment and its share of the underlying net assets of the investee was $27.7 million and $29.8 million as of March 31, 2017 and December 31, 2016, respectively; these differences are amortized over a period of 10 years from the initial investment date. In addition, net investment income for the three months ended March 31, 2017 includes $20.8 million of accelerated expenses (that the Partnership otherwise would have incurred later in the year) as a result of the March 2017 amendment to acknowledge that the performance conditions related to the contingently issuable Carlyle Holdings partnership units had substantially been met ahead of the measurement date. Equity Method Investments The Partnership’s equity method investments include its fund investments in Corporate Private Equity, Real Assets, Global Market Strategies, and Investment Solutions, typically as general partner interests, and its strategic investments in NGP (included within Real Assets), which are not consolidated. Investments are related to the following segments:
| As of
| March 31, 2017 |  | December 31, 2016
| (Dollars in millions)
Corporate Private Equity | $ | 305.8 |  |  | $ | 282.4 |
Real Assets | 659.7 |  |  | 622.8 |
Global Market Strategies | 16.0 |  |  | 20.1 |
Investment Solutions | 28.1 |  |  | 25.6 |
Total | $ | 1,009.6 |  |  | $ | 950.9 |
Investment Income (Loss) The components of investment income (loss) are as follows:
| Three Months Ended March 31,
| 2017 |  | 2016
| (Dollars in millions)
Income (loss) from equity investments | $ | 45.4 |  |  | $ | (6.4 | )
Income (loss) from investments in CLOs and other investments | 0.9 |  |  | (3.5 | )
Other investment income | — |  |  | 0.3 |
Total | $ | 46.3 |  |  | $ | (9.6 | )
Carlyle’s income (loss) from its equity method investments is included in investment income (loss) in the condensed consolidated statements of operations and consists of:
| Three Months Ended March 31,
| 2017 |  | 2016
| (Dollars in millions)
Corporate Private Equity | $ | 7.6 |  |  | $ | (2.3 | )
Real Assets | 35.0 |  |  | 1.8 |
Global Market Strategies | 1.3 |  |  | (4.9 | )
Investment Solutions | 1.5 |  |  | (1.0 | )
Total | $ | 45.4 |  |  | $ | (6.4 | )
Investments in CLOs and Other Investments Investments in CLOs and other investments as of March 31, 2017 and December 31, 2016 primarily consisted of $159.4 million and $156.1 million, respectively, of investments in CLO senior and subordinated notes, derivative instruments, and corporate mezzanine securities and bonds. Investments of Consolidated Funds The Partnership consolidates the financial positions and results of operations of certain CLOs in which it is the primary beneficiary. During the three months ended March 31, 2017, the Partnership did not form any CLOs in which it is the primary beneficiary. There were no individual investments with a fair value greater than five percent of the Partnership’s total assets for any period presented. Interest and Other Income of Consolidated Funds The components of interest and other income of Consolidated Funds are as follows:
| Three Months Ended March 31,
| 2017 |  | 2016
| (Dollars in millions)
Interest income from investments | $ | 40.5 |  |  | $ | 27.7 |
Other income | 2.4 |  |  | 1.2 |
Total | $ | 42.9 |  |  | $ | 28.9 |
Net Investment Gains (Losses) of Consolidated Funds Net investment gains (losses) of Consolidated Funds include net realized gains (losses) from sales of investments and unrealized gains (losses) resulting from changes in fair value of the Consolidated Funds’ investments. The components of net investment gains (losses) of Consolidated Funds are as follows:
| Three Months Ended March 31,
| 2017 |  | 2016
| (Dollars in millions)
Gains (losses) from investments of Consolidated Funds | $ | 35.2 |  |  | $ | (67.8 | )
Gains (losses) from liabilities of CLOs | (18.1 | ) |  | 59.4 |
Total | $ | 17.1 |  |  | $ | (8.4 | )
The following table presents realized and unrealized gains (losses) earned from investments of the Consolidated Funds:
| Three Months Ended March 31,
| 2017 |  | 2016
| (Dollars in millions)
Realized losses | $ | (2.1 | ) |  | $ | (6.2 | )
Net change in unrealized gains (losses) | 37.3 |  |  | (61.6 | )
Total | $ | 35.2 |  |  | $ | (67.8 | )

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- Definition The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=66011266&loc=d3e33918-111571 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -SubTopic 10 -Section 35 -Paragraph 35 -URI http://asc.fasb.org/extlink&oid=64825282&loc=d3e32847-111569 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.12) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -SubTopic 10 -Section 35 -Paragraph 32 -URI http://asc.fasb.org/extlink&oid=64825282&loc=d3e32787-111569 + Details
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