Background
The Blackstone Group (Blackstone) is a private equity firm founded in 1985 by two former employees of Lehman Brothers. In May 2007 the firm had $88.4 billion under management and had grown 41% annually since 2001.
The firm operated in several business groups but distinguished itself from other firms by extensive collaboration across divisions. It was divided into Corporate Private Equity, Real Estate Funds, Marketable Alternative Asset Management, Corporate Debt Funds, and Advisory Services.
In 2007 Blackstone started to evaluate the option of taking the firm public. Reasons why the firm should do an IPO, outlined by the firm’s internal project group, included:
• Permanent pool of inexpensive capital and a wider group
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Third, to further smooth out potential fluctuations in the share price the firm guarantees a dividend during the first years after listing.
The fact that the stock market tends to be short-term focused further shows the importance of having the MLP structure. To maintain the long-term focus on investments the firm needs to separate the governance of the firm from the shareholders and the limited voting rights will ensure this.
2. If you were a limited partner in Blackstone, how would you view the structure Blackstone has put in place to go public?
As a limited partner in Blackstone I would consider the structure as chosen to ensure my interests. Given the fact that the firm chose to go public for the opportunities that a listing brings, it seems to be the best way of doing it.
I would be most worried about that the firm would try too much to stabilize the share price and fulfil the interest of the shareholders by focusing on short-term profits. Many of the limited partners in a private equity fund are pensions funds or similar and do not mind to lock their money over a longer time period and, by doing so, seek the long-term profit that the private equity firm can offer. I will highlight the two things that make me confident that my interests as a limited partner will be maintained with the structure that the firm is implementing. First, the structure allows
1.What are conversion factors? Why were conversion factors developed? How do they impact on which bond is cheapest to deliver? Under what conditions would there be no cheapest to deliver? Explain in detail.
Dividends should be made cumulative and issuable upon a liquidation event or an IPO. Such dividends may be converted, if the holder desires, to common shares. This will encourage management to seek a quicker exit.
Reviewing GM's financial information in GM Exhibit 1 and its stock price in GM Exhibit 2, when do you first see signs of GM's impending financial distress?
3. At what price would you recommend that Rosetta Stone shares be sold?Rosetta Stone: Pricing the 2009 IPO
3. What restructuring option – Icahn’s spin-off proposal or the company’s targeted stock proposal – will create the most value for shareholders? For creditors? For the firm’s other stakeholders?
1. Was Borg-Warner’s Industrial Products Group a good candidate for a leveraged buyout in 1987? Evaluate the price paid and the structure of the deal that closed in May 1987. Are you optimistic about BW/IP’s prospects?
As for private equity asset allocation the Investment Office focused on finding external "value-added investors" with the sterling capability to build better businesses not only financially but mainly operationally. They believed this strategy led to enhancing returns independently of the market downturns. Thus, a limited number of long-standing partnerships were created - exclusively with partners aligned with the generalized investment policies of the Investment Office - with "over 90% of the portfolio invested in
With the stock market being one of the most difficult trades to learn, it remains noteworthy to come across someone who knows how to trade stocks. This remains attributed to the fact that stocks involve a lot of speculative information. However, the benefits remain fruitful for the people willing to engage in such high-risk investing. With that being said, Igor Cornelsen remains a prominent figure in the investment community. Moreover, Igor possesses years of expertise and has demonstrated his "know how" of trading stocks.
aimed at expanding the jeans product line and diversifying into new areas. It acquired Blue Bell
Q1. What are the built-in tensions with a public private equity firm? How does Blackstone 's structure attempt to reconcile them?
On May 17, 1792 24 stock brokers signed the Buttonwood Agreement on Wall Street in New York City under a Buttonwood tree. The agreement formed a centralized exchange that eliminated the need for auctioneers. It also set up rules for the trading of public bonds that were used to pay for the American Revolution. In 1817, a formal organization was setup and named the New York Stock Exchange & Board. In 1863 it was renamed the New York Stock Exchange and in 1903 it moved to its present headquarters at 18 Broad Street.
There are many different ways to save money and there are different things to save for. A savings plan for an immediate want is apparently different than a savings strategy for retirement. One may choose to select stocks, bonds, or mutual funds for a savings strategy, however, my personal choice is to invest in bonds first, then mutual funds.
Scope. We have investigated several possible solutions for KTM: (1) an initial public stock offering; (2) a
The dividend policy has grown over the years. This may be so that the company projects itself as a less risky share and thus also gaining investors faith. The investors buy its shares and thus increase its demand. This helps to gives positive signals to the investors signalling that the company is stable and can generate earnings steadily. This hypothesis is gains standing from the dividend hypothesis theory.
Choosing two profitable stocks amongst a myriad of potential alternatives is a daunting task to say the least. In order to narrow my choices from thousands to two, I examined several aspects of companies I was interested in. Among these were, company overview, alpha and beta ratings, price ratios, price charts, and company headlines. After evaluating this information, I chose Intuit INC (INTU) listed on the NASDAQ and Johnson and Johnson (JNJ) listed on the NYSE.