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thepeel
Joined: 08 Aug 2004
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 Posted: Sun May 20, 2007 6:12 pm Post subject: Beijing to buy Blackstone stake for $3bn |
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http://www.ft.com/cms/s/4b717f78-06fd-11dc-93e1-000b5df10621.html
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The Chinese government is to use $3bn of its vast foreign exchange reserves to buy a 9.9 per cent stake in Blackstone, the US buy-out fund, in an unprecedented move that underlines Beijing�s desire to tap into the private equity boom.
The investment will coincide with Blackstone�s landmark $40bn stock market listing, expected in the next few months, and will allow the private equity group to nearly double its original target of raising $4bn.
Stephen Schwarzman, Blackstone�s chief executive, hailed the deal � the first time Beijing has invested its foreign reserve in a commercial transaction � as an �historic event that changes the paradigm in global capital flows�.
Under the terms of the deal, which is believed to have been agreed in just a few weeks, the Chinese government has taken the unusual step of giving up its voting rights associated with the stake in Blackstone.
The move appears aimed at defusing any US political opposition to the deal at a time of tension between Washington and Beijing over the renminbi.
It is understood that China�s foreign reserve agency has agreed not to invest in rival private equity groups for 12 months. A number of Blackstone�s rivals, including Kohlberg Kravis Roberts, Texas Pacific Group and Apollo are exploring listings or private placings.
China�s decision to buy a stake in Blackstone�s IPO rather than in one of its buy-out funds, which are more volatile and risky, is a sign of Beijing�s cautious approach to private equity. |
That they will use some of their foreign reserves to buy international firms is very reassuring news. The more internationalized the Chinese economy becomes, the more they need international peace and stability to continue their growth. We should welcome investments like this.
The more it is in China's interest for peace and prosperity to continue around the world, the more stable the world will be. |
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cosmo
Joined: 09 Nov 2006
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| Posted: Sun May 20, 2007 8:02 pm Post subject: Re: Beijing to buy Blackstone stake for $3bn |
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Last edited by cosmo on Thu Jun 21, 2007 11:07 pm; edited 1 time in total |
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thepeel
Joined: 08 Aug 2004
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| Posted: Mon May 21, 2007 2:21 am Post subject: |
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The Red Army actually does "sell" the services of entire divisions to Chinese-based firms (both public and private) doing business in Africa.
On topic, the Economist this week has a great editorial about America fearing China.. I'll post it. |
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Kuros
Joined: 27 Apr 2004
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| Posted: Mon May 21, 2007 4:45 am Post subject: |
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| It's not even a 10% stake. Let 'em have it. |
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