Investment Updates News
- Blackstone to sell stake to State Investment
Date: 22-May-2007 Sources: (Shenzhen Daily)
U.S. buyout firm Blackstone Group agreed to sell a US$3 billion stake to the Chinese Government, gaining an ally in its effort to expand into the country's private-equity market.
China's soon-to-be-formed State Investment Co. will buy an undisclosed number of nonvoting Blackstone shares at 95.5 percent of the price set in its planned initial public offering (IPO).
The stake will be reduced if necessary to keep it below 10 percent after the IPO, the government and New York-based Blackstone said yesterday in a statement. At 10 percent, the purchase values the firm at about US$30 billion.
Blackstone stepped up its China efforts in January, hiring Antony Leung, the former Hong Kong Financial Secretary, to head its Asia Pacific operations with Ben Jenkins, a senior managing director who recently moved to Hong Kong from New York.
Blackstone's investment from the Chinese Government comes as the firm, founded in 1985, prepares a US$4 billion IPO. It hasn't disclosed how many shares it plans to sell.
The State Investment Co. committed to holding the Blackstone stake, its first investment, for at least four years. It won't invest in another private-equity firm for a year.
China, the largest holder of U.S. government debt behind Japan, is creating the investment company to buy potentially more lucrative assets such as private equity.
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