Barclay's PLC downgraded BX from overweight to underweight.
Blackstone Group, along with hedge fund GSO Capital Partners (which Blackstone owns), announced a plan to invest $500 million in Crestwood Midstream Partners LLC, a U.S. oil pipeline company.
Blackstone said the lack of liquidity -- meaning the willingness of banks to lend it money to buy companies -- due to the subprime crisis and tightening debt markets was making it difficult for kind of large private equity purchases that Blackstone specializes in. The company also reported a quarterly loss.
News of the proposed Baucus-Grassley bill, which would raise taxes on publicly traded hedge funds and private equity firms, sent shares of Blackstone down on August 24th. According to Blackstone's management, the bill would add $525 million to the firm's tax bill, tripling its current burden.
Blackstone Group LP, manager of the world's largest private-equity fund, said second-quarter earnings more than tripled as revenue increased during a record year for leveraged buyouts. Net income was $774 million compared with $224 million a year earlier. Revenue more than tripled in its main private equity business.
Blackstone Group LP shares closed at a new low, making the leveraged buyout firm the worst-performing initial public offering this year. Blackstone has tumbled 22 percent since the New York-based company sold shares in June. Fortress Investment Group LLC of New York, the first U.S. buyout firm to go public, has fallen 47 percent from a high of $37 in February. The slump occurred as investors shunned riskier bonds and loans used to fund takeovers. (source: bloomberg.com)
Blackstone Group said it will buy Hilton Hotels in a $26 billion deal that will add one of the largest U.S. hotel chains to the list of companies bought out by private-equity firms this year. Also, Blackstone Group is in talks to buy a $400 million stake in China National BlueStar Group, a state-owned chemical company. Market watchers believe Blackstone, which raised $4.1 billion in a New York listing late last month, will have an easier path to making acquisitions in China since a government agency invested $3 billion in the firm. (source: reuters.com)