NEW YORK -- Blackstone Group LP Monday said it planned to raise as much as $7.75 billion from selling shares to the public and to China, in perhaps the year's most eagerly awaited U.S. initial public offering.
In a filing with the U.S. Securities and Exchange Commission, the private equity firm said it plans to offer 133.3 million common units at $29 and $31 each, for proceeds of $3.87 billion to $4.13 billion. The IPO may grow to $4.75 billion if another 20 million units are sold to meet demand.
Blackstone announced the terms one day after saying China would take a $3 billion stake at a 4.5 percent discount to the IPO price. Beijing would hold its shares for at least four years.
The IPO would rank among the top 10 U.S. IPOs, according to Dealogic, and the largest by a private equity firm. It could value Blackstone at $33.6 billion, based on an equivalent 1.085 billion units outstanding after the offerings, the firm said. It was not immediately clear when the IPO might take place.
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Blackstone is going public as low debt costs spur a private-equity takeover boom. Private equity firms buy companies, restructure their businesses, and sell them.
Rival Fortress Investment Group LLC went public in February in a $635 million IPO, and on Friday had a market value of $11.4 billion. Two investment banks, Lehman Brothers Holdings Inc. and Bear Stearns Cos., have respective market values of $38.6 billion and $17.8 billion.
Blackstone is selling units as a master limited partnership, giving shareholders limited voting rights.
Existing holders would retain a 78.1 percent stake, while Beijing would own 9.7 percent and new unit holders 12.2 percent, Blackstone said. If the overallotment option were exercised, new unit holders would own 14.1 percent.
Raising funds through an IPO would give Blackstone quick access to money it would otherwise have to raise privately. Blackstone has said having public equity allows flexibility in pursuing future deals and gives it a variety of financial means to retain employees.
In the quarter that ended March 31, net income more than doubled to $1.13 billion from $487.2 million a year earlier, according to the filing. Revenue also more than doubled, to $479.4 million from $221 million.
Net gains from investment activities more than doubled to $3.78 billion from $1.69 billion. Blackstone said it had $88.4 billion of assets under management as of May 1.
Blackstone 's transactions this year include a $23 billion takeover of Sam Zell's Equity Office Properties Trust, and an agreement to buy business services company Alliance Data Systems Corp. for $6.76 billion.
The firm was started in 1985 by Stephen Schwarzman and former Lehman Brothers Chief Executive Pete Peterson, who intends to retire by the end of 2008.
Blackstone plans to list its units on the New York Stock Exchange under the symbol "BX." It said Citigroup Global Markets Inc. and Morgan Stanley are the lead IPO underwriters. Credit Suisse, Deutsche Bank Securities Inc., Lehman and Merrill Lynch & Co. are joint book-runners.
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