Washington - Blackstone Group LP's plans to
go public to raise 4 billion dollars has opened its records to public
scrutiny, revealing the firm's moneymaking power.
Blackstone, now considered the world's largest leveraged buyout fund,
on Thursday announced it would sell a minority stake in what is being
called the biggest initial public offering by a US buyout manager.
The company has built its wealth, ironically, by buying public firms
and taking them private since its founding in 1985 by bankers Stephen
Schwarzman and Pete Peterson. It has spent 160 billion dollars in this
pursuit, and currently has 78.7 billion dollars in assets under
management, it was reported Friday.
A first look at its
financial details by Bloomberg financial news showed that Blackstone's
770 workers in New York produced nearly nine times more earnings than
their rivals at Goldman Sachs Group Inc, Wall Street's most profitable
investment bank.
The workers produced an average of 2.95
million dollars in net income in 2006, according to the documents
handed in to the US Securities and Exchange Commission that regulates
trading in public companies. At Goldman, Bloomberg reported, the mean
was 360,000 dollars.
Blackstone's earnings were 2.27 billion
dollars in 2006, 71 percent more than a year earlier. The firm's
private equity funds returned more than 20 per cent.
By going public, Blackstone said it would have new money to expand into new businesses and buy out partners ras they leave.
'They'll get a potential source of permanent capital, where they can
capitalize on their earnings and provide some liquidity to their
partners over time,' Frederick Joseph, managing partner of Morgan
Joseph Co, was quoted as saying. 'It's a potential source of
capital if they want to broaden what they're doing.'
Blackstone's funds currently own companies with 375,000 employees and 83 billion dollars in annual sales.
Blackstone's most recent acquisitions include the hard-fought Equity
Office Properties Trust for 23 billion dollars and 16 billion dollars
in assumed debt.
Blackstone said its private-equity funds
have returned an average 23 per cent a year, after fees, and its real
estate investments have gained 29 per cent.
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