The chiefs of the world’s two biggest private equity firms described their asset class as one of the last, best hopes available to score the kinds of returns that pension funds and even individual investors need to catch up following the financial crisis.
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Blackstone Group posted a worse-than-expected quarterly loss on Thursday as market declines hit the value of the private equity firm’s investments, forcing it to book a huge accounting loss. Its net loss, which measures operating performance, was $342 million, compared with a profit of $339 million a year earlier. Adjusted ENI was a loss of 31 [...]
(Reuters) – Blackstone Group posted a worse-than-expected quarterly loss on Thursday as market declines hit the value of the private equity firm’s investments, forcing it to book a huge accounting loss.
But Blackstone said assets under management on which it earns management fees increased during the quarter, operating performance of its portfolio companies and properties was strong, and U.S. and European markets had rebounded since Sept. 30.
The company said it had record $33.4 billion of “dry powder,” or capital available to invest, up from $31.4 billion in the second quarter, and expected its latest real estate fund to raise more than $10 billion.
(Reuters) – The heads of two of the world’s most powerful private equity firms issued a dire report on the U.S. economy on Wednesday, signaling problems for political leaders and their own firms’ ability to realize profit on their portfolios.
“We never really emerged from the last recession,” Carlyle Group co-founder David Rubenstein said at a breakfast session at Lincoln Center that also featured Blackstone Group Chief Executive Stephen Schwarzman.
“It will last a few more years before we get unemployment to a level that is tolerable,” Rubenstein said.
Time to catch up on the stories your colleagues found most compelling on peHUB this week. Here are the top 10 posts that garnered the most pageviews from regular readers from Sept. 19 to Sept. 23.
One: Trouble Making Ends Meet: Top 10 Cash Returning Funds In Cal Regents’ Venture Portfolio (Slideshow) — by Mark Boslet
Two: Slideshow: Face Scrubbers, Balloon Trips: 16 at CalPERS Face Fines for Alleged Gift Violations (subscribers only) — by Gregory Roth
Three: Slideshow: Q3’s Most Active Buyers — by Bernard Vaughan
Four: Slideshow: Top-Performing PE/VC Funds for State of Florida — by David Toll
Five: Wringing Money from a Flagging Venture Fund — for a Price — by Connie Loizos
Six: Blackstone Looks to Advise Startups — by Luisa Beltran
Seven: Pressure on Solyndra Backers Intensifies — by Roberta Rampton, Reuters
Eight: Soros, Schwarzman Move Up On Forbes 400 Richest List — by Luisa Beltran
Nine: Obama Pitches Changes to Carried Interest; PEGCC Rebuts “Buffett Rule” — by Luisa Beltran
Ten: MassPRIM Loses Second PE Manager — by Gregory Roth
Leon Black has apparently learned nothing from Stephen Schwarzman. In 2007, Blackstone CEO Schwarzman famously gave himself a 60th birthday party that cemented his reputation as the “villain of private equity.” Schwarzman’s $3 million bash, held at the Park Avenue Armory, featured Martin Short as the m.c., while Pattie LaBelle — leading the Abyssinian Baptist [...]
Stephen Schwarzman, the Blackstone Group’s chairman and CEO, has gotten a little richer.
Schwarzman’s 23% stake in Blackstone fully vested this month. The CEO owns 231 million Blackstone units but the last chunk, 38 million, vested on June 21, I’m told. Shares of Blackstone were up 35 cents to $16.73 in mid-day trading Thursday. So, Schwarzman’s stake is now worth roughly $3.9 billion.
Blackstone went public in June 2007, raising $4.13 billion. Employees of the buyout shop owned 75% of the company after the IPO. Schwarzman has the largest stake and he hasn’t sold any units, I’m told. The CEO is known for his lavish parties, but we think this one is worthy of another fiesta. Congrats, Steve!
(Reuters) – On an overcast day in May, a clutch of the world’s most powerful investors gathered in a 19th-century mansion in Moscow to hear a proposition from Vladimir Putin: invest in Russia, and we will invest with you.
For forty minutes at the government’s Vozdvizhenka guest house, the prime minister addressed private equity and sovereign wealth funds representing a combined $2 trillion of wealth. He was pitching a plan to launch a $10 billion state-backed fund that Russia hopes can win over those foreign investors who still regard the country as a no-go zone.
There was “a lot of back and forth and some tough
This week FINS reported that buyout shops are raiding investment banks for relatively inexperienced analysts. Buyout shops typically pick up execs from two-year analyst programs at IBs. But this year, PE firms are scooping up candidates less than a year after they graduate from college, according to FINS.
These fresh grads are getting good money. Recent offers for analysts guarantee $220,000 to $250,000 a year, though highly coveted workers are getting more than $300,000, FINS says.
This made me wonder: With lower-tier employees taking home such big paychecks, how much are PE executives making?
Stephen Schwarzman, the Blackstone Group’s chairman and CEO, earned