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Blackstone: Billions on the line and out for blood


Blackstone Group was one of those named

Blackstone Group was one of those named

Blackstone Group was one of those named

"As we look at the current situation in Europe, we're basically waiting to see how beaten up people's psyches get, and where they're willing to sell assets… You want to wait until there's really blood in the streets".

The speaker was Steve Schwarzman, chief executive of Blackstone, giving his thoughts on buying up Europe's distressed assets to an audience at Goldman Sachs in New York in 2010.

In the few short years since Mr Schwarzman spoke those words, his company has bought about €2bn of Irish loans and property. It now owns the Burlington hotel, a 25pc stake in Eircom, offices - and more recently, €1.8bn par value of loans linked to developer Michael O'Flynn, bought from NAMA at a discount for around €1.1bn.

As one of the world's biggest private equity firms, Blackstone invests on behalf of wealthy individuals and pension funds. It sells just as much as it buys. Its motto is "buy it, fix it, sell it"; we can expect to see that approached applied to its Irish assets very soon.


But its Irish assets are just a drop in Blackstone's ocean. The New York-based firm now has $80bn (€60bn) in assets under its management. That's more than Luxembourg's annual GDP.

Its portfolio stretches around the world. Choice examples include New York's Waldorf Astoria and the Hilton hotel chain.

But you don't make an omelette of that size without breaking a few eggs. The company hit the headlines this week after paying out millions, alongside two other investment firms, to settle allegations that it colluded to keep prices low on some assets it bought. Blackstone made the settlement without admission of liability and denied the allegations

Its spending spree shows no signs of letting up. It emerged earlier this year that it has raised $15bn fund from investors, giving it access to a veritable war chest for acquisitions.

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