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Buoyant Blackstone beats forecasts
07.08.09
Blackstone, probably the biggest name in private equity, this afternoon delivered some much-needed good news for the industry as it beat profit forecasts and sounded optimistic about coming months.
With bank lending still hard to come by for leveraged takeovers, the big deals which have in the past provided massive profits for private equity firms have disappeared, leaving many in crisis and forced to slash the valuations they put on companies they own.
But Blackstone today said that it had upped the valuation of its portfolio of private equity investments by 3% for the second quarter and was hoping to sniff out bargain deals.
Blackstone has $29 billion (£17.2 billion) of unspent investors' cash in its warchest — the biggest amount in its history.
“We're pleased how solid our portfolio is, given the buffeting it has taken from the economic downturn,” said chief operating officer Tony James.
Less positive, however, was the performance of its property investment portfolio which was down 19%.
Second-quarter profits were $173 million, up from $100 million a year earlier.
