Blackstone IPO Date Fixed

Blackstone Group's much-anticipated initial public offering IPO of its management company will occur during the week of June 25.

Blackstone, the world's largest private-equity firm, will sell 12.3% of its management arm in an offering expected to value the entire company at around $32 billion. Investors will have little voting say in Blackstone itself; instead, their stake would be tied to the management committee that runs the company.

Blackstone said it plans to offer 133.3 million common units at $29 to $31 each. Another 20 million units may be sold to meet demand, boosting the IPO as high as $4.75 billion plus $3 billion from China making it $7.75 billion. However with plenty of additions and clauses, Blackstone said the IPO could value the firm at $33.6 billion, roughly one-third of Goldman Sachs Group Inc’s market value. This grand total will boost Blackstone’s carry in the financial services industry, making comparisons with some of Wall Street’s heavy public hitters like Goldman Sachs and Morgan Stanley. Blackstone plans to list its shares on the New York Stock Exchange under the symbol "BX."

Blackstone has expanded its planned $4 billion IPO to $7 billion to accommodate the Chinese investment. This investment gives China a taste of the booming private equity market. China will take 9.9% non-voting stake in Blackstone, leaving it under the radar screen from U.S. govt scrutiny. China has agreed to hold their investments for atleast 4 years for which they bagged a 4.5% discount. This whole deal is a win-win proposition for both parties. For China it means a role in the global private equity market and higher profits, where as for Blackstone it means increase in access to Chinese markets.

Earlier this week, Blackstone raised eyebrows when it disclosed that Chief Executive Stephen Schwarzman made $400 million in 2006, nearly double the combined compensation for the CEOs of Wall Street's five biggest investment banks. Schwarzman will control about 24 percent of Blackstone after the IPO.