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US DoJ probes Blackstone, Apollo and KKR & Co on overlapping board seats

The US Department of Justice (DoJ) has launched an investigation into whether the way a group of private equity majors, including Blackstone Inc, Apollo Global Management Inc and KKR & Co, influence the boards of US corporates violates antitrust laws, according to a report by Bloomberg.

The report cites unnamed sources as revealing that the weather PE firms’ practice of placing executives on boards of companies in the same sector harms competition, is the focus of the DoJ investigation.

The concern among investigators is that board directors with seats on rivals in the same sector could influence those companies to act in ways that maximise gains for all, thereby reducing competition to provide the best services or lowest prices to consumers. 

Blackstone, Apollo and KKR are reportedly among a number of private equity firms of various sizes that, over the past month, have been sent so-called civil investigative demands, which are similar to subpoenas, on the subject. 

Receiving a civil investigative demand doesn’t imply wrongdoing.

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