The Blackstone Group

The Blackstone Group L.P.
Master limited partnership
Traded as NYSE: BX
Industry Financial services
Founded 1985 (1985)
Founder Peter George Peterson
Stephen A. Schwarzman
Headquarters 345 Park Avenue, Manhattan, New York City, New York, United States
Key people
 Stephen A. Schwarzman
(Chairman and CEO)
Hamilton E. James
(President & COO)
J. Tomilson Hill
(Vice Chairman)
Jonathan D. Gray
(Global Head of Real estate)
Products Private equity
Investment management
Asset management
Revenue Increase US$ 7.484 billion (2014)
Increase US$ 1.584 billion (2014)
AUM Increase US$ 311 billion (2015)[1][2]
Total assets Increase US$ 31.510 billion (2014)
Number of employees
 2,190 (2014)
Subsidiaries

Mphasis

Hilton Worldwide

The Weather Channel

Alight Solutions
Website www.blackstone.com

The Blackstone Group L.P. is an American multinational private equity, alternative asset management and financial services firm based in New York City. As the largest alternative investment firm in the world,[3] Blackstone specializes in private equity, credit and hedge fund investment strategies.[4]

Blackstone's private equity business has been one of the largest investors in leveraged buyout transactions over the last decade, while its real estate business has actively acquired commercial real estate. Since its inception, Blackstone has completed investments in such notable companies as Hilton Worldwide, Merlin Entertainments Group, Performance Food Group, Equity Office Properties, Republic Services, AlliedBarton, United Biscuits, Freescale Semiconductor, Vivint,[5] and Travelport.[6]

Blackstone was founded in 1985 as a mergers and acquisitions boutique by Peter G. Peterson and Stephen A. Schwarzman, who had previously worked together at Lehman Brothers, Kuhn, Loeb Inc. Over the course of two decades, Blackstone has evolved into one of the world's largest private equity investment firms.[3] In 2007, Blackstone completed a $4 billion initial public offering to become one of the first major private equity firms to list shares in its management company on a public exchange.[7][8] Blackstone is headquartered at 345 Park Avenue in Manhattan, New York City, with eight additional offices in the United States, as well as offices in London, Paris, Düsseldorf, Sydney, Tokyo, Hong Kong, Singapore, Beijing, Shanghai, Madrid, Mumbai, and Dubai.[9]

Business segments

Blackstone is organized into four business segments:[10]

Corporate private equity

As of 2011, Blackstone is the world's fifth-largest private equity firm by committed capital, focusing primarily on leveraged buyouts of more mature companies.[7] The firm also invests through minority investments, corporate partnerships, and industry consolidations, and occasionally, start-up investments in new entrants into existing industries. The firm focuses on friendly investments in large capitalization companies.[10]

Blackstone's private equity business employs approximately 120 investment employees in New York City; London; Menlo Park, California; Mumbai; Hong Kong; and Beijing.[6]

Historically, Blackstone has primarily relied on private equity funds, pools of committed capital from pension funds, insurance companies, endowments, fund of funds, high-net-worth individuals, sovereign wealth funds, and other institutional investors.[11] As of the end of 2008, Blackstone had completed fundraising for six funds with total investor commitments of over $36 billion, including five traditional private equity fund and a separate fund focusing on telecommunications investments.

Below is a summary of Blackstone's private equity funds raised from its inception through the beginning of 2009:[12]

FundVintage
Year		Committed
Capital ($b)
Blackstone Capital Partners I1987$0.8
Blackstone Capital Partners II1994$1.27
Blackstone Capital Partners III1997$3.78
Blackstone Communications Partners I2000$2.02
Blackstone Capital Partners IV2003$6.45
Blackstone Capital Partners V2006$21.7
Blackstone Capital Partners VI2010$13.5

From 1987 to the time of its IPO filing in 2007, Blackstone invested approximately $20 billion in capital in 109 private equity transactions.[10]

Blackstone's most notable investments include Allied Waste,[13] AlliedBarton Security Services, Graham Packaging, Celanese, Nalco, HealthMarkets, Houghton Mifflin, American Axle, TRW Automotive, Catalent Pharma Solutions, Prime Hospitality, Legoland, Madame Tussauds,[14] Luxury Resorts (LXR), Pinnacle Foods, Hilton Hotels Corporation, Apria Healthcare, Travelport, The Weather Channel (United States) and The PortAventura Resort. In 2009 Blackstone purchased Busch Entertainment (comprising the Sea World Parks, Busch Garden Parks and the 2 water parks).[15]

In 2012, Blackstone acquired a controlling interest in Utah-based Vivint, Inc., a home automation, security, and energy company.[16]

Former notable investments include Universal Studios Parks, which was sold to Comcast.

Real estate

Blackstone began building its real estate investment business in 1992 with the acquisition of a series of hotel businesses and has built it into a global operation with 122 investment professionals in the United States, Europe and Asia. The real estate business has raised approximately $28 billion for a variety of fund vehicles, including six US-focused funds and three International opportunity funds. Blackstone also raised a real estate special situations fund focusing on non-controlling debt and equity investment opportunities. The special situations fund invests directly in real estate as well as private and publicly traded real estate-related securities.[10][17]

The following is a summary of Blackstone's real estate funds raised from inception through November 2009:[12]

FundVintage
Year		Committed
Capital ($b)
Blackstone Real Estate Partners I1994$0.48
Blackstone Real Estate Partners II1996$1.3
Blackstone Real Estate Partners III1999$1.5
Blackstone Real Estate Partners International (Europe)2001€0.8
Blackstone Real Estate Partners IV2003 (alt value 2004)[18]$2.5 (alt value €6.7bn)[18]
Blackstone Real Estate Partners International (Europe) II2006€1.55
Blackstone Real Estate Partners V2006$5.25
Blackstone Real Estate Partners VI2007$10.9
Blackstone Real Estate Special Situations PE Fund2008$1.0
Blackstone Real Estate Partners Europe III2009€3.1

From 1987 through the time of its IPO filing in 2007, Blackstone invested more than $13 billion in 212 real estate transactions and is a major owner of real estate throughout the US and Europe.[10] Blackstone's most notable real estate investments have included Equity Office Properties, Hilton Hotels Corporation, Trizec Properties, Center Parcs UK, La Quinta Inns & Suites, Motel 6, Wyndham Worldwide, Southern Cross Healthcare and Vicinity Centres.[19]

The purchase and subsequent profitable IPO of Southern Cross led to controversy in the UK. Part of the purchase involved splitting the business into a property company, NHP, and a care home business, which Blackstone claimed would become "the leading company in the elderly care market". In May 2011, Southern Cross, now independent, was almost bankrupt, jeopardising 31,000 elderly residents in 750 care homes. It denied blame, although Blackstone was widely accused in the media for selling on the company with an unsustainable business model and crippled with an impossible sale and leaseback strategy.[20][21]

After the subprime mortgage crisis, Blackstone Group LP has bought more than $5.5 billion single-family homes for rent, to be sold when the prices rise.[22]

Blackstone has agreed to sell a selection of Northern California office buildings for the sum of $3.5 billion, in the latest sale of real estate by the firm.[23]

Marketable alternative asset management

In 1990, Blackstone created a fund of hedge funds business to manage the internal assets for Blackstone and its senior managers. Over the years, this business evolved into Blackstone's marketable alternative asset management segment, which was opened to institutional investors. Among the investments included in this segment are funds of hedge funds, mezzanine funds, senior debt vehicles, proprietary hedge funds and closed-end mutual funds.[10]

In March 2008, Blackstone acquired GSO Capital Partners, a credit-oriented alternative asset manager, for $620 million in cash and stock and up to $310 million through an earnout over the next five years based on certain earnings targets. The combination of Blackstone and GSO created one of the largest credit platforms in the alternative asset management business, with over $21 billion of total assets under management.[24] GSO was founded in 2005 by Bennett Goodman, Tripp Smith and Doug Ostrover. The GSO team had previously managed the leveraged finance businesses at Donaldson, Lufkin & Jenrette and later Credit Suisse First Boston, after the acquisition of DLJ. Blackstone had existing relationships with the GSO team as an original investor in GSO's funds. Following the completion of the acquisition, Blackstone merged GSO's operations with its existing debt investment operations.[25][26]

Financial advisory services

Blackstone's financial advisory business is composed of three businesses:[10]

Blackstone was founded by Peterson and Schwarzman in 1985 as a boutique investment banking firm that provides mergers and acquisitions advisory services. Among Blackstone's most notable corporate and mergers and acquisitions, advisory clients include Microsoft, Procter & Gamble, Verizon, Comcast, Sony and AIG.[27][28]

In 1991, with the collapse of the 1980s buyout boom, Blackstone began to offer advisory services in corporate restructurings as well. Blackstone's most notable restructuring clients have included General Motors[29] Xerox, Enron,[30] Bally Total Fitness and Global Crossing.

Blackstone's fund placement advisory group, The Park Hill Group, was formed in 2005 with a team of professionals from Atlantic-Pacific Capital and Credit Suisse. The group focuses on raising capital from institutional investors for private investment vehicles that invest in private equity, mezzanine, real estate, venture capital, and hedge funds.[31] Park Hill Group also provides secondary advisory services to investors seeking portfolio liquidity and unfunded commitment relief.[32]

In 2006 John Studzinski joined The Blackstone Group as the senior managing director in its investment and advisory group and as a member of the firm's executive committee.[33][34] He was recruited to oversee and develop Blackstone’s mergers-and-acquisitions advisory business, Blackstone Advisory Partners, in the United States and Europe, and to open an office in London.[34][35] His primary role as global head of Blackstone Advisory Partners was to oversee Blackstone's corporate M&A advisory services business in the U.S., and further develop the corporate M&A advisory business in Europe and Asia.[36][37] In early 2015, Blackstone began spinning off three of its divisions, including its M&A advisory group, to avoid any potential conflicts of interest with its primary private-equity business.[38][39][40] After assisting with the transition,[41] Studzinski became Vice Chairman of Investor Relations and Business Development at The Blackstone Group.[42][43] In this capacity, he holds responsibility for a number of sovereign and international institutional relationships, as well as ultra high-net-worth families outside the U.S.[42]

History

Founding and early history

The Blackstone Group was founded in 1985 by Peter G. Peterson & Stephen A. Schwarzman and Richard Bennett with $400,000 in seed capital.[44][45] The founders named their firm "Blackstone", which was a cryptogram derived from the names of the two founders (Schwarzman and Peterson): "Schwarz" is German for "black"; "Peter", or "Petra" in Greek, means "stone" or "rock".[46] The two founders had previously worked together at Lehman Brothers, Kuhn, Loeb Inc. At Lehman, Schwarzman served as head of Lehman Brothers' global mergers and acquisitions business.[47] Prominent investment banker Roger C. Altman, another Lehman veteran, left his position as a managing director of Shearson Lehman Brothers to join Peterson and Schwarzman at Blackstone in 1987, but left in 1992 to join the Clinton Administration as Deputy Treasury Secretary.

Blackstone was originally formed as a mergers and acquisitions advisory boutique. Blackstone advised on the 1987 merger of investment banks E. F. Hutton & Co. and Shearson Lehman Brothers, collecting a $3.5 million fee.[48][49]

Blackstone co-founder Peter Peterson was former chairman of Lehman Brothers, Kuhn, Loeb Inc.

From the outset in 1985, Schwarzman and Peterson planned to enter the private equity business, but had difficulty in raising their first fund because neither had ever led a leveraged buyout.[50] Blackstone finalized fundraising for its first private equity fund in the aftermath of the October 1987 stock market crash. After two years of providing strictly advisory services, Blackstone decided to pursue a merchant banking model after its founders determined that many situations required an investment partner rather than just an advisor. The largest investors in the first fund included Prudential Insurance Company, Nikko Securities and the General Motors pension fund.[51]

Blackstone also ventured into other businesses, most notably investment management. In 1987 Blackstone entered into a 50–50 partnership with the founders of BlackRock, Larry Fink and Ralph Schlosstein. The two founders, who had previously run the mortgage-backed securities divisions at First Boston and Lehman Brothers Kuhn Loeb, respectively, initially joined Blackstone to manage an investment fund and provide advice to financial institutions. They also planned to use a Blackstone fund to invest in financial institutions and help build an asset management business specializing in fixed income investments.[10][52]

As the business grew, Japanese bank Nikko Securities acquired a 20% interest in Blackstone for a $100 million investment in 1988 (valuing the firm at $500 million). Nikko's investment allowed for a major expansion of the firm and its investment activities.[53] The growth firm also recruited politician and investment banker David Stockman from Salomon Brothers in 1988. Stockman led many key deals in his time at the firm, but had a mixed record with his investments.[54] He left Blackstone in 1999 to start his own private equity firm, Heartland Industrial Partners, based in Greenwich, Connecticut.[55][56]

The firm advised CBS Corporation on its 1988 sale of CBS Records to Sony to form what would become Sony Music Entertainment.[57] In June 1989, Blackstone acquired freight railroad operator, CNW Corporation.[58] That same year, Blackstone partnered with Salomon Brothers to raise $600 million to acquire distressed thrifts in the midst of the savings and loan crisis.[59]

1990s

The Blackstone Group logo in use prior to the firm's rebranding as simply Blackstone

As the 1990s began, Blackstone continued its growth and expansion into new businesses. In 1990, Blackstone launched its fund of hedge funds business, initially intended to manage investments for Blackstone senior management. Also in 1990, Blackstone extended its ambitions to Europe, forming a partnership with J. O. Hambro Magan in the UK and Indosuez in France. In 1991, Blackstone created its Europe unit to enhance the firm's presence internationally.[60][61]

In 1991, Blackstone launched its real estate investment business with the acquisition of a series of hotel businesses under the leadership of Henry Silverman. In 1990, Blackstone and Silverman acquired a 65% interest in Prime Motor Inn's Ramada and Howard Johnson franchises for $140 million, creating Hospitality Franchise Systems as a holding company.[62] In October 1991, Blackstone and Silverman added Days Inns of America for $250 million.[63] Then, in 1993, Hospitality Franchise Systems acquired Super 8 Motels for $125 million.[64] Silverman would ultimately leave Blackstone to serve as CEO of HFS, which would later become Cendant Corporation.

Blackstone made a number of notable investments in the early and mid-1990s, including Great Lakes Dredge and Dock Company (1991), Six Flags (1991), US Radio (1994), Centerplate (1995), MEGA Brands (1996). Also, in 1996, Blackstone partnered with the Loewen Group, the second largest funeral home and cemetery operator in North America, to acquire funeral home and cemetery businesses. The partnership's first acquisition was a $295 million buyout of Prime Succession from GTCR.[65][66][67]

Through the mid and late 1990s, Blackstone continued to grow. In 1997, Blackstone completed fundraising for its third private equity fund, with approximately $4 billion of investor commitments[68] and a $1.1 billion real estate investment fund.[69] In the following year, in 1998, Blackstone sold a 7% interest in its management company to AIG, replacing Nikko Securities as its largest investor and valuing Blackstone at $2.1 billion.[70] Then, in 1999, Blackstone launched its mezzanine capital business. Blackstone brought in five professionals, led by Howard Gellis from Nomura Holding America's Leveraged Capital Group to manage the business.[71]

Blackstone's investments in the late 1990s included AMF Group (1996), Haynes International (1997), American Axle (1997), Premcor (1997), CommNet Cellular (1998), Graham Packaging (1998), Centennial Communications (1999), Bresnan Communications (1999), PAETEC Holding Corp. (1999). Haynes and Republic Technologies International, a specialty steel maker in which Blackstone invested in 1996, both had problems and ultimately filed bankruptcy.[72]

Also, in 1997, Blackstone made its first investment in Allied Waste. Two years later, in 1999, Blackstone, together with Apollo Management provided capital for Allied Waste's acquisition of Browning-Ferris Industries in 1999 to create the second largest waste management company in the US. Blackstone's investment in Allied was one of its largest to that point in the firm's history.[13]

Its investments in telecommunications businesses—four cable TV systems in rural areas (TW Fanch 1 and 2, Bresnan Communications and Intermedia Partners IV) and a cell phone operator in the Rocky Mountain states (CommNet Cellular) were among the most successful of the era, generating $1.5 billion of profits for Blackstone's funds.[73]

Blackstone Real Estate Advisers, its real estate affiliate, bought the Watergate Complex in Washington D.C. in July 1998 for $39 million[74] and sold it to Monument Reality in August 2004.[75]

Early 2000s

Blackstone acquired the mortgage for 7 World Trade Center in October 2000 from the Teachers Insurance and Annuity Association.[76]

Schwarzman's Blackstone Group completed the first major IPO of a private equity firm in June 2007.[77]

In July 2002, Blackstone completed fundraising for a $6.45 billion private equity fund, Blackstone Capital Partners IV, the largest private equity fund ever raised to that point. More than $4 billion of the capital was raised by the end of 2001 and Blackstone was able to secure the remaining commitments despite adverse market conditions.[78]

With a significant amount of capital in its new fund, Blackstone was one of a handful of private equity investors capable of completing large transactions in the adverse conditions of the early 2000s recession. At the end of 2002, Blackstone, together with Thomas H. Lee Partners and Bain Capital, acquired Houghton Mifflin Company for $1.28 billion. The transaction represented one of the first large club deals, completed since the collapse of the Dot-com bubble.[79]

In 2002, Hamilton E. James joined global alternative asset manager Blackstone, where he currently serves as president and chief operating officer. He also serves on the firm's executive and management committees, and its board of directors.[80] In late 2002, Blackstone remained active acquiring TRW Automotive in a $4.7 billion buyout, the largest private equity deal announced that year (the deal was completed in early 2003). TRW's parent was acquired by Northrop Grumman, while Blackstone purchased its automotive parts business, a major supplier of automotive systems.[81][82] Blackstone also purchased a majority interest in Columbia House, a music buying club, in mid-2002.[83]

Blackstone made a significant investment in Financial Guaranty Insurance Company (FGIC), a monoline bond insurer alongside PMI Group, The Cypress Group and CIVC Partners. FGIC incurred heavy losses, along with other bond insurers in the 2008 credit crisis.[84]

Two years later, in 2005, Blackstone was one of seven private equity firms involved in the buyout of SunGard in a transaction valued at $11.3 billion. Blackstone's partners in the acquisition were Silver Lake Partners, Bain Capital, Goldman Sachs Capital Partners, Kohlberg Kravis Roberts, Providence Equity Partners, and TPG Capital. This represented the largest leveraged buyout completed since the takeover of RJR Nabisco at the end of the 1980s leveraged buyout boom. Also, at the time of its announcement, SunGard would be the largest buyout of a technology company in history, a distinction it would cede to the buyout of Freescale Semiconductor. The SunGard transaction is also notable in the number of firms involved in the transaction, the largest club deal completed to that point.[85] The involvement of seven firms in the consortium was criticized by investors in private equity who considered cross-holdings among firms to be generally unattractive.[86][87]

In 2006, Blackstone launched its new long / short equity hedge fund business, Kailix Advisors. According to Blackstone, as of September 30, 2008, Kailix Advisors had $1.9 billion of assets under management. In December 2008, Blackstone announced that Kailix would be spun off to its management team to form a new fund as an independent entity backed by Blackstone.[26]

While Blackstone was active on the corporate investment side, it was also busy pursuing real estate investments. Blackstone acquired Prime Hospitality[88] and Extended Stay America in 2004. Blackstone followed these investments with the acquisition of La Quinta Inns & Suites in 2005. Blackstone's largest transaction, the buyout of Hilton Hotels Corporation occurred in 2007. Extended Stay Hotels was sold to The Lightstone Group in July 2007 and Prime Hospitality's Wellesley Inns were folded into La Quinta.[89] La Quinta Inns & Suites went public in 2014 and is now controlled by La Quinta Holdings as the parent organization.[90]

Buyout boom (2005–2007)

During the buyout boom of 2006 and 2007, Blackstone completed some of the largest leveraged buyouts. Blackstone's most notable transactions during this period included the following:

InvestmentYearCompany DescriptionRef.
TDC 2005In December 2005, Blackstone together with a group of firms, including Kohlberg Kravis Roberts, Permira, Apax Partners and Providence Equity Partners, acquired Tele-Denmark Communications. The firms acquired the former telecom monopoly in Denmark, under the banner Nordic Telephone Company (NTC) for approximately $11 billion.[91]
Equity Office 2006Blackstone completes the $37.7 billion acquisition of one of the largest owners of commercial office properties in the US. At the time of its announcement, the Equity Office buyout became the largest in history, surpassing the buyout of HCA. It would later be surpassed by KKR's buyout of TXU. Vornado Realty Trust bid against Blackstone, pushing up the final price.[92][93]
Freescale Semiconductor 2006A consortium led by Blackstone and including the Carlyle Group, Permira and the TPG Capital completed the $17.6 billion takeover of the semiconductor company. At the time of its announcement, Freescale would be the largest leveraged buyout of a technology company ever, surpassing the 2005 buyout of SunGard. The buyers were forced to pay an extra $800 million because KKR made a last minute bid as the original deal was about to be signed. Shortly after the deal closed in late 2006, cell phone sales at Motorola Corp., Freescale's former corporate parent and a major customer, began dropping sharply. In addition, in the recession of 2008–2009, Freescale's chip sales to automakers fell off, and the company came under great financial strain.[94][95]
Michaels 2006Blackstone, together with Bain Capital, acquired Michaels, the largest arts and crafts retailer in North America in a $6.0 billion leveraged buyout in October 2006. Bain and Blackstone narrowly beat out Kohlberg Kravis Roberts and TPG Capital in an auction for the company.[96]
Nielsen Holdings 2006Blackstone together with AlpInvest Partners, Carlyle Group, Hellman & Friedman, Kohlberg Kravis Roberts and Thomas H. Lee Partners acquired the global information and media company formerly known as VNU. [97][98][99]
Orangina[100] 2006Blackstone, together with Lion Capital acquired Orangina, the bottler, distributor and franchisor of a number of carbonated and other soft drinks in Europe from Cadbury Schweppes for €1.85 billion[101]
Travelport 2006Travelport, the parent of the travel web site Orbitz.com, was acquired from Cendant by Blackstone and Technology Crossover Ventures in a deal valued at $4.3 billion. The sale of Travelport followed the spin-offs of Cendant's real estate and hospitality businesses, Realogy Corporation and Wyndham Worldwide Corporation, respectively, in July 2006. (Later in the year, TPG and Silver Lake would acquire Travelport's chief competitor Sabre Holdings.) Soon after the Travelport buyout, Travelport spun off part of its subsidiary Orbitz Worldwide in an IPO and bought a Travelport competitor, Worldspan.[102][103][104]
United Biscuits 2006In October 2006 Blackstone, together with PAI Partners announced the acquisition of the British biscuit producer. The deal was completed in December 2006.[105][106]
RGIS Inventory Specialists 2007In March 2007, RGIS announced that Blackstone Group purchased a controlling interest in the company, the terms of the transaction were not disclosed. [107]
Biomet 2007Blackstone, Kohlberg Kravis Roberts, TPG Capital and Goldman Sachs Capital Partners acquired the medical devices company for $11.6 billion.[108]
Hilton Worldwide 2007Blackstone acquired the premium hotel operator for approximately $26 billion, representing a 25% premium to Hilton's all-time high stock price. The Hilton deal, announced on July 3, 2007 is often referred to as the deal that marked the "high water mark" and the beginning of the end of the multi-year boom in leveraged buyouts. The company restructured its debt in 2010.[109][110][111]

Initial public offering in 2007

In 2004, Blackstone had explored the possibility of creating a business development company (BDC), Blackridge Investments, similar to vehicles pursued by Apollo Management.[112] However, Blackstone failed to raise capital through an initial public offering that summer, and the project was shelved.[113] It also planned to raise a fund on the Amsterdam stock exchange in 2006, but its rival, Kohlberg Kravis Roberts & Co., launched a $5 billion fund there that soaked up all demand for such funds, and Blackstone abandoned its project.[114]

By the summer of 2006, Blackstone had a more ambitious goal and secretly began laying the groundwork for an IPO of the firm itself, and managed to keep the project quiet for eight or nine months.[7][115] On March 22, 2007, Blackstone filed with the SEC[10] to raise $4 billion in an initial public offering. On June 3, 2007, Blackstone announced the acquisition of Alliant Insurance Services, Inc., one of the nation's largest insurance brokerage firms.[116] On June 21, Blackstone sold a 12.3% stake in its ownership for $4.13 billion in the largest U.S. IPO since 2002. Traded on the New York Stock Exchange under the ticker symbol BX, Blackstone priced at $31 per share on June 22, 2007.[8][117] In July 2007, less than two weeks after the Blackstone IPO, its rival private equity firm, Kohlberg Kravis Roberts, filed with the SEC.[118] In October 2009, KKR listed its shares on the Euronext exchange and anticipates a listing on the New York Stock Exchange.[119]

2008 to 2010

Since the closure of the credit markets in 2007 and 2008, Blackstone has managed to close only a small number of sizable transactions. In January 2008, Blackstone made a small co-investment alongside TPG Capital and Apollo Management in their buyout of Harrah's Entertainment, although that transaction had been announced during the buyout boom period. Other notable investments that Blackstone completed in 2008 and 2009 included AlliedBarton, Performance Food Group,[120][121] Apria Healthcare and CMS Computers.

Among the firm's two largest investments since the buyout boom have been The Weather Channel and the announced acquisition of Busch Entertainment. In July 2008, Blackstone, together with NBC Universal and Bain Capital agreed to purchase The Weather Channel from Landmark Communications.[122][123] In October 2009, Anheuser-Busch InBev announced the sale of its Busch Entertainment Corporation theme parks division to Blackstone for $2.7 billion.[124][125] The Financial Times reported that Merlin Entertainments owned by Blackstone Group will file an IPO[126] in the 2nd quarter of 2010. Merlin will be listed on the London Stock Exchange. If true this would be the second of 8 reported IPOs Blackstone plans,[127] the first being Team Health Holdings, Inc.[128] Blackstone reported at the end of 2009 revenues of $1.8bln, compared to -$349mln revenues in 2008.[129] On August 13, 2010 Blackstone announced it would buy Dynegy, an energy firm, for nearly $5 billion.[130]

In 2010, Blackstone Alternative Asset Management, received Institutional Investor magazine's 8th Annual Hedge Fund Industry award for Large Fund of Hedge Funds of the Year.[131]

Investments since 2011

Self-dealing

In 2013, Bloomberg uncovered how the Blackstone Group was self-dealing after its affiliate GSO Capital Partners purchased debt and credit default swaps in Codere SA, a Spanish betting, online gambling and gaming company.[150]

In the first half of 2013, Blackstone GSO and another firm later purchased a €100 million bank loan (via secondary markets) that Codere already had on the books, and then convinced Codere to delay repayment on the debt related to the aforementioned credit default swaps. That delay triggered the CDS, resulting in upwards of $18.7 million in profit for GSO.[151]

The GSO director defended the move with "Codere (working with us...) had to trigger the credit default swaps, as it was the only way to compel certain bondholders to negotiate." and blamed credit default swap investors for their loss:

Unlike Blackstone, who invested directly into Codere, these financial investors [of hedge funds using credit default swaps] were not aligned with the interests of Codere, but instead through their use of credit default swaps, were betting on when the Company would default[...]having no interest in the outcome of the game.[151]

See also

References

  1. ↑ Stephen Schwarzman speaks with Betty Liu and Erik Schatzke on "In the Loop" (April 16, 2015). Schwarzman Says Fundraising Environment Is 'Remarkable' (Television production). Bloomberg. Event occurs at 00:22 minutes in. Retrieved March 16, 2016. You've got assets now at three hundred billion dollars.
  2. ↑ "Blackstone Reports Third Quarter Results" (PDF). The Blackstone Group. January 31, 2013. Archived from the original (PDF) on October 30, 2014.
  3. 1 2 Wiliam Alden (April 18, 2013). "Public Offering Values SeaWorld at $2.5 Billion". The New York Times. Retrieved April 19, 2013.
  4. ↑ "The Blackstone Group". The New York Times. Retrieved 12 January 2016.
  5. ↑ Kim, Soyoung (September 19, 2012). "Blackstone buys security firm Vivint for over $2 billion". Reuters. Retrieved 2013-03-23.
  6. 1 2 Blackstone Group: Private Equity Archived February 4, 2009, at the Wayback Machine. (company website). See also: Blackstone Private Equity Investment by Transaction Size Archived January 17, 2009, at the Wayback Machine. (company website), Team (company website). Accessed 2009-02-20
  7. 1 2 3 Blackstone Said to Prepare for I.P.O. New York Times, March 16, 2007
  8. 1 2 Anderson, Jenny. "Blackstone Founders Prepare to Count Their Billions." New York Times, June 12, 2007.
  9. ↑ "Blackstone - Our Offices overview". Blackstone.
  10. 1 2 3 4 5 6 7 8 9 The Blackstone Group L.P., Form S-1, Securities And Exchange Commission, March 22, 2007
  11. ↑ New bosses, new rules. Los Angeles Times, August 12, 2007
  12. 1 2 Data collected from Preqin, a private equity database system
  13. 1 2 A trash hauler is buying a much bigger rival, a type of deal that makes Wall Street a bit nervous. New York Times, March 9, 1999
  14. ↑ Equity Firm Attracted to Attractions. New York Times, March 6, 2007
  15. ↑ Blackstone Private Equity Investment by Transaction Size (company website). Accessed 2009-02-20 Archived January 17, 2009, at the Wayback Machine.
  16. ↑ Kim, Soyoung; Roumeliotis, Greg (9 September 2012). "Blackstone buys security firm Vivint for over $2 billion". Reuters. Retrieved 4 January 2013.
  17. ↑ Blackstone Real Estate Overview. (company website). Accessed 2009-02-20 Archived January 6, 2009, at the Wayback Machine.
  18. 1 2 "Blackstone amasses more capital for latest Europe RE pool". AltAssets. 20 December 2016. Retrieved 2016-12-20.
  19. ↑ Blackstone Real Estate Investment Portfolio ( at company website). Accessed 2009-02-20 Archived January 17, 2009, at the Wayback Machine.
  20. ↑ Alex Hawkes "Blackstone denies blame for Southern Cross's plight" The Guardian, Thursday 2 June 2011
  21. ↑ Nils Pratley "Was Southern Cross always sickly underneath?" The Guardian, Thursday 2 June 2011
  22. ↑ Karmin, Craig (August 12, 2013). "Blackstone to Buy Stakes in Apartment Complexes From GE Unit". The Wall Street Journal.
  23. ↑ Alden, William (December 8, 2014). "Blackstone to Sell California Office Buildings for $3.5 Billion". New York Times. Retrieved 2014-12-19.
  24. ↑ Blackstone to Buy GSO Capital. New York Times, January 10, 2008
  25. ↑ Blackstone to Buy Hedge Fund to Strengthen Credit Operations. New York Times, January 11, 2008
  26. 1 2 Blackstone To Rationalize Single Manager Hedge Funds Businesses In Efficiency Move. Press Release, December 23, 2008
  27. ↑ Schwarzman Unbowed. Bloomberg Markets, March 2009
  28. ↑ Blackstone Financial Advisory: Selected Clients (company website). Accessed 2009-02-20 Archived February 16, 2009, at the Wayback Machine.
  29. ↑ Moore, Heidi N. (December 12, 2008). "GM Hires Blackstone". Wall Street Journal. Retrieved 2008-12-12.
  30. ↑ "Blackstoin Restructuring & Reorganization: Selected Transactions".(Company website) Accessed 10/20/2012
  31. ↑ Blackstone: Private Placement Advisory Overview (The Park Hill Group). Company website, Accessed 2009-02-20 Archived December 18, 2008, at the Wayback Machine.
  32. ↑ Park Hill Group: About Us. Company website, Accessed 2011-1-26
  33. ↑ Moyer, Liz. "Hitting A Brick Wall". Forbes. May 18, 2006.
  34. 1 2 "John Studzinski Joins Blackstone". The Blackstone Group. May 18, 2006.
  35. ↑ Wachman, Richard. "Cracking the Studzinski code". The Observer. October 7, 2006.
  36. ↑ John Studzinski CBE. FT Business of Luxury Summit, 30 May – 1 June 2012. Financial Times. 2012.
  37. ↑ About John Studzinski. John Studzinski's blog.
  38. ↑ "Blackstone to list advisory arm early 2015". Financial Times. October 2014.
  39. ↑ Dezember, Ryan. "Blackstone Group to Spin Off Financial Advisory Business". Wall Street Journal. October 10, 2014.
  40. ↑ Blackstone – History: 2014. Blackstone. Blackstone.com. Retrieved March 30, 2015.
  41. ↑ Roumeliotis, Greg and Paritosh Bansal. "UPDATE 4-Blackstone gives up its roots in advisory unit spin-off". Reuters. October 10, 2014.
  42. 1 2 John Studzinski – Official profile, Blackstone.
  43. ↑ "E.U. Estrangement Before The Divorce (a.k.a Volatility)". Fund Portfolio Management. January 23, 2015.
  44. ↑ David Carey and John E. Morris, King of Capital: The Remarkable Rise, Fall and Rise Again of Steve Schwarzman and Blackstone (Crown 2010), pp. 45–56
  45. ↑ Private equity power list: #1 The Blackstone Group. Fortune, July 2, 2007
  46. ↑ Blackstone etymology. The Deal, June 26, 2007
  47. ↑ Alden, William. "Blackstone's Chief Has a Warning for Wall Street's Entrepreneurs". DealBook. Retrieved 2017-01-27.
  48. ↑ Hutton-Shearson Deal Announced". New York Times, December 4, 1987.
  49. ↑ "Hutton Sets Fees". New York Times, December 9, 1987
  50. ↑ King of Capital, pp. 45-56
  51. ↑ A Big Fund Ready to Capitalize on Hard Times. New York Times, November 13, 1987
  52. ↑ "Mortgage Unit Leaders To Join Blackstone". New York Times, March 4, 1988
  53. ↑ "Nikko Acquires 20% of Blackstone Group". New York Times, December 13, 1988
  54. ↑ King of Capital, pp. 144–147
  55. ↑ "Stockman Forming Own Buyout Concern". New York Times, September 17, 1999
  56. ↑ "Stockman Is Charged With Fraud". New York Times, March 27, 2007
  57. ↑ "Sony and CBS Records: What a Romance!". New York Times, September 18, 1988
  58. ↑ "CNW Accepts Buyout Bid From Blackstone Group". New York Times, June 7, 1989
  59. ↑ "2 Wall Street Firms Join To Buy Savings Units". New York Times, May 12, 1989
  60. ↑ U.S. Mergers Firm Is Forming British Link. New York Times, April 23, 1990
  61. ↑ Chairman Is Named For Blackstone Unit. New York Times, April 5, 1991
  62. ↑ Prime to Sell Interest in Inns to Blackstone. New York Times, May 24, 1990
  63. ↑ Blackstone Unit to Buy Days Inns. New York Times, October 1, 1991
  64. ↑ Hospitality to Acquire Super 8 Motels. New York Times, February 17, 1993
  65. ↑ The Loewen Group and Blackstone Capital Partners form corporate venture to acquire Prime Succession. Business Wire, June 17, 1996. Accessed 2009-02-20.
  66. ↑ Loewen And Blackstone To Make Joint Purchase. New York Times, June 18, 1996
  67. ↑ Loewen Buys Big Cemetery, And Its Suitor Criticizes Deal. New York Times, September 21, 1996
  68. ↑ Blackstone Raises $4 Billion for Fund. New York Times, October 10, 1997
  69. ↑ Red-Hot Revival in Real Estate; Overheating Is Feared With Surge in Vulture Investing. New York Times, November 6, 1997
  70. ↑ A.I.G. Will Put $1.35 Billion Into Blackstone. New York Times, July 31, 1998
  71. ↑ Blackstone to Form a New Financing Unit. New York Times, April 8, 1999
  72. ↑ King of Capital, pp. 145-146
  73. ↑ King of Capital, pp. 148–155
  74. ↑ Cube, Christine (Nov 25, 2002). "Watergate Hotel For Sale". Washington Business Journal.
  75. ↑ Staff Report (Aug 19, 2004). "Monument Realty Buys Watergate Hotel". Commercial Real Estate Direct.
  76. ↑ "Blackstone Acquires Debt on 7 World Trade Center". Business Wire. October 17, 2000.
  77. ↑ Photographed at the World Economic Forum in Davos, Switzerland in January 2008.
  78. ↑ Blackstone Amasses a Record Equity Fund. New York Times, July 17, 2002
  79. ↑ Vivendi Finishes Sale of Houghton Mifflin To Investors. New York Times, January 1, 2003
  80. ↑ Sender, Henny. "At Blackstone, James Builds A Following". The Wall Street Journal. Retrieved 23 March 2007.
  81. ↑ King of Capital, pp. 176, 197, 206-207
  82. ↑ Blackstone Group May Purchase Auto Parts Business From TRW. New York Times, November 13, 2002
  83. ↑ Blackstone Buys Majority Stake in Columbia House. New York Times, May 15, 2002
  84. ↑ A Split-Up of Insurers of Bonds Is Considered. New York Times, February 16, 2008
  85. ↑ King of Capital, p. 225
  86. ↑ "Capital Firms Agree to Buy SunGard Data in Cash Deal." Bloomberg L.P., March 29, 2005
  87. ↑ Do Too Many Cooks Spoil the Takeover Deal?. New York Times, April 3, 2005
  88. ↑ The Blackstone Group to Acquire Prime Hospitality Corp. Press Release, August 18, 2004. Accessed 2009-02-20 Archived March 8, 2005, at the Wayback Machine.
  89. ↑ Private-Equity Firm Sees Room for Value in Hotels. Wall Street Journal, August 17, 2005
  90. ↑ http://ir.lq.com/Cache/1500058950.PDF?Y=&O=PDF&D=&FID=1500058950&T=&IID=4424891
  91. ↑ Equity Firms Buy Danish Phone Company. New York Times, December 1, 2005
  92. ↑ King of Capital, pp. 239–254
  93. ↑ Blackstone's Bid for Equity Office Prevails New York Times, February 8, 2007
  94. ↑ King of Capital, 231-235
  95. ↑ Sorkin, Andrew Ross and Flynn, Laurie J. "Blackstone Alliance to Buy Chip Maker for $17.6 Billion." New York Times, September 16, 2006
  96. ↑ Consortium Buys Michaels for $6 Billion. New York Times, July 1, 2006
  97. ↑ VNU Shareholders Reject $8.9 Bln Offer From KKR Group. Bloomberg, March 8, 2006
  98. ↑ Buyout Bid For Parent Of Nielsen. New York Times, January 17, 2006
  99. ↑ VNU Agrees To Public Offer From Private Equity Group. Press Release, March 8, 2006
  100. ↑ "Company News Headlines". NASDAQ.com. June 2, 2011. Retrieved 2013-01-29.
  101. ↑ Cadbury Sells Beverage Unit to Two Firms. New York Times, November 22, 2005
  102. ↑ King of Capital, pp. 314-318
  103. ↑ Sachdev, Ameet. " Orbitz travels to 4th owner: Blackstone Group to buy from Cendant.", Chicago Tribune, July 1, 2006. Accessed September 15, 2007.
  104. ↑ Fineman, Josh. "Cendant to sell Orbitz to Blackstone for $4.3 Bln", Bloomberg.com, June 30, 2006. Accessed September 15, 2007.
  105. ↑ Parkinson, Gary (October 26, 2006). "Private-equity companies snap up United Biscuits in a £1.6bn deal". The Independent. Retrieved 2007-04-12.
  106. ↑ "Blackstone and PAI complete purchase of UB" (Press release). United Biscuits. December 15, 2006. Archived from the original on September 27, 2007. Retrieved 2007-04-12.
  107. ↑ . RGIS Press Release, March, 21st 2007
  108. ↑ de la Merced, Michael J. "Biomet Accepts Sweetened Takeover Offer." New York Times, June 8, 2007.
  109. ↑ Blackstone to Buy Hilton Hotels for $26 Billion. New York Times, July 4, 2007
  110. ↑ High-Water Mark. New York Times, July 4, 2008
  111. ↑ King of Capital, pp. 299–300
  112. ↑ Private Firms Use Closed-End Funds to Tap the Market. New York Times, April 17, 2004
  113. ↑ Blackstone Group Postpones Fund Offering. New York Times, July 16, 2004
  114. ↑ King of Capital, pp. 221–223
  115. ↑ King of Capital, pp. 255–267
  116. ↑ Alliant Insurance Services, Inc. to be acquired by Blackstone and Management, June 3, 2007 Archived March 4, 2016, at the Wayback Machine.
  117. ↑ Sorkin, Andrew Ross and de la Merced, Michael J. "News Analysis Behind the Veil at Blackstone? Probably Another Veil." New York Times, March 19, 2007.
  118. ↑ KKR & Co. L.P., Form S-1, Securities And Exchange Commission, July 3, 2007
  119. ↑ KKR lists on Euronext; NYSE is next. Reuters, October 1, 2009
  120. ↑ Equity Firms Acquiring Food Supplier. Bloomberg, January 19, 2008
  121. ↑ Blackstone, Wellspring to acquire Performance Food Group in $1.3bn deal. AltAssets, January 18, 2008 Archived June 11, 2008, at the Wayback Machine.
  122. ↑ Michael J. de la Merced (July 7, 2008). "Weather Channel Is Sold to NBC and Equity Firms". New York Times. Retrieved 2008-09-17.
  123. ↑ Robert Marich. "The Weather Channel Sale Wraps". Broadcasting & Cable. Archived from the original on September 15, 2008. Retrieved 2008-09-26.
  124. ↑ Blackstone to buy A-B InBev's theme parks for $2.7 billion. MarketWatch, Oct. 7, 2009
  125. ↑ InBev may sell US theme parks. Boston Globe, July 16, 2008
  126. ↑ "Blackstone's Merlin Entertainment to Go Public in '10, FT Says". Bloomberg. October 23, 2009.
  127. ↑ "Blackstone plans portfolio IPOs: source". Reuters. October 12, 2009.
  128. ↑ Wahba, Phil (October 6, 2009). "Blackstone-owned hospital staffing company files IPO". Reuters.
  129. ↑ Opalesque (26 February 2010). "Blackstone revenues in 2009 show strong bounce back from 2008".
  130. ↑ "Finance after the crisis: Survival of the richest". The Economist. The Economist Newspaper Limited. 396 (8696): 59. 21–27 August 2010.
  131. ↑ Hedge Fund Industry Awards, The 8th Annual Hedge Fund Awards, Retrieved June 2011
  132. ↑ Whitley, Angus; Saminather, Nichola (February 28, 2011). "Blackstone Said to Acquire Centro's U.S. Shopping Centers for $9.4 Billion". Bloomberg.
  133. ↑ Nussbaum, Alex; Kelly, Jason (August 4, 2011). "Blackstone Group Agrees to Acquire Medical-Biller Emdeon for $3 Billion". Bloomberg.
  134. ↑ De, Michael J. "The Blackstone Group News". New York Times. Retrieved 2013-01-29.
  135. ↑ Jolie O'Dell, VentureBeat. "Blackstone just backed out of its proposed Dell buyout." April 19, 2013. Retrieved on April 19, 2013.
  136. ↑ Blackstone Announces Strategic Investment in ThoughtFocus Technologie. Wall Street Journal (2013-09-30). Retrieved on 2013-12-06.
  137. ↑ Ryan, Dezember (April 24, 2014). "Bargain Bin Is Now Big Deal". WSJ. Retrieved 29 April 2014.
  138. ↑ Versace deal with Blackstone values group at 1 billion euros, Reuters, February 26, 2014
  139. ↑ Zargani, Luisa (27 February 2014). "Versace Sells Minority Stake to Blackstone". Women's Wear Daily. Retrieved 27 February 2014.
  140. ↑ Vuong, Andy (April 20, 2014). "Blackstone grants $4 million to create Colorado entrepreneurs network". The Denver Post. Retrieved 22 April 2014.
  141. ↑ Arno Schuetze & Edward Taylor (May 15, 2014). "Deutsche Bank sells casino to Blackstone for $1.7 billion". Reuters.
  142. ↑ By David Carey, Bloomberg. "." August 10, 2014. August 13, 2014.
  143. ↑ Blackstone to sell prime Sydney property to Dalian Wanda for $327 million. Reuters, 26 January 2015
  144. ↑ "Blackstone to buy Excel Trust for about $2 billion" (Press release). Reuters. 10 April 2015.
  145. ↑ "Blackstone to buy BioMed Realty in $8 billion deal". Reuters. 8 October 2015.
  146. ↑ "Blackstone to sell GCA Services to Thomas Lee, Goldman Sachs". Reuters. 16 November 2015.
  147. ↑ Brown, Eliot (24 November 2015). "Blackstone in Talks to Sell Four Los Angeles Office Towers". Wall Street Journal. ISSN 0099-9660. Retrieved 2015-12-05.
  148. ↑ Jamerson, Joshua (February 10, 2017), Blackstone to Buy Aon’s Human Resources Outsourcing Platform for $4.3 Billion, New York City: The Wall Street Journal, retrieved February 12, 2017
  149. ↑ http://uk.reuters.com/article/uk-officegroup-m-a-blackstone-idUKKBN19A1J4
  150. ↑ Stephanie Ruhle; Mary Childs; Julie Miecamp (22 October 2013). "Blackstone Unit Wins in No-Lose Codere Trade: Corporate Finance". Bloomberg News.
  151. 1 2 Dan Primack (5 December 2013). "Blackstone responds to Jon Stewart". finance.fortune.cnn.com.
  • David Carey, John E. Morris (2010). King of Capital: The Remarkable Rise, Fall, and Rise Again of Steve Schwarzman and Blackstone.
  • The Making of a Wise Man. New York Times, November 28, 2004
This article is issued from Wikipedia. The text is licensed under Creative Commons - Attribution - Sharealike. Additional terms may apply for the media files.