Blackstone says not using tax loopholes

(Reuters) - The newspaper said in an article on Friday that Blackstone
had devised a way for its partners to effectively avoid paying
taxes on $3.7 billion, the bulk of what it raised last month
from selling shares to the public. The New York Times
was not immediately available for comment.




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Blackstone Founders, Schwarzman May Avoid Paying Taxes on Gains From IPO

(Bloomberg) -- Blackstone Group LP's founders
including Stephen Schwarzman will eventually get back some, if
not all, of the taxes they pay on $3.7 billion in gains from the
management company's initial public offering last month.

Blackstone said in filings with the Securities and Exchange
Commission that it would apply a commonly used strategy that
requires a firm's new shareholders to return to the founders most
of the value of tax benefits created when the original partners
sold a portion of their interest in the company.


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UPDATE 3-Hilton would pay $560 mln Blackstone break-up fee

(Reuters) - Blackstone, which agreed to buy Hilton for about $20
billion plus debt, would pay Hilton $660 million if it backs
out of the deal, Hilton said in a filing with the U.S.
Securities and Exchange Commission.




Break-up fees are customary in takeover deals and are put
in place to dissuade the two sides from walking away.


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Kohlberg Kravis Earns Half as Much as Schwarzman's Blackstone Before IPO

(Bloomberg) -- Kohlberg Kravis Roberts & Co., whose
funds control companies with more than $100 billion in annual
revenue and 560,000 employees, earned half as much as its
largest competitor, Blackstone Group LP.

KKR, which announced plans this week to raise about $1.25
billion in an initial public offering, reported net income of
$1.1 billion in 2006, trailing Blackstone's $2.3 billion,
according to a filing with the U.S. Securities and Exchange
Commission.


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UPDATE 2-Buyout firm KKR files for $1.25 bln IPO

(Reuters) - The planned IPO follows last month's high-profile listing of
rival Blackstone Group LP , which raised $4.13 billion and
ushered in a new era for an industry that has come to dominate
financial markets worldwide by pursuing ever-larger takeovers and
raising record amounts of capital.




Unlike the Blackstone IPO, however, KKR's owners are not
selling any common units or receiving any net proceeds.


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Dow Average Futures Advance as Bond Yields, Oil Drop; GM, Blackstone Gain

(Bloomberg) -- Dow Jones Industrial Average futures
rose after bond yields fell and oil prices dropped.

General Motors Corp. climbed after Goldman, Sachs & Co.
advised clients to buy shares of the biggest U.S. automaker
because the United Auto Workers union may offer larger-than-
expected concessions. Blackstone Group LP, the private-equity
firm valued at $38 billion after its initial public offering June
22, also gained.


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Blackstone raises $4.1 billion

(Reuters) - The pricing, closely watched by regulators and financial markets worldwide, proved demand for the offering was heavy despite pressure from Congress.




Blackstone's planned opening on the New York Stock Exchange on Friday is a watershed event for the booming private equity industry as it is the first major U.S. buyout firm to take part of itself public. Blackstone will trade under the symbol "BX".


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U.S. shares set for weak start; eyes on Blackstone

(Reuters) - Investor focus is likely to be on private equity group
Blackstone , which makes its debut on the New York Stock
Exchange after its initial public offering at $31 a share valued
it at $33.48 billion and marked a watershed for the booming
private equity industry.




"The Street is talking of an opening $2 to $3 higher, and
it's clear that those who got in early will make money," Steve
Previs of Jefferies International said.


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Bear still hoping to restructure funds - source

(Reuters) - Blackstone declined to comment. Bear Stearns was not immediately available for comment.




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UPDATE 1-U.S. senator raises China concerns on Blackstone

(Reuters) - WASHINGTON, June 20 - U.S. Senator Jim Webb asked
federal authorities on Wednesday to look into "national
security implications" he said are posed by Chinese government
involvement with Blackstone Group LP [BG.UL] as it moves toward
a stock offering expected to raise more than $4 billion.




Webb raised concerns in a letter to Securities and Exchange
Commission Chairman Christopher Cox, Treasury Secretary Henry
Paulson and Homeland Security Secretary Michael Chertoff.


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UPDATE 1-U.S. senators seek SEC study on Blackstone bill

(Reuters) - WASHINGTON, June 20 - The leaders of the U.S.
Senate Banking Committee on Wednesday asked the Treasury
Department and the Securities and Exchange Commission for
analysis of legislation that would raise taxes on private
equity funds going public, like Blackstone Group LP [BG.UL].




Sens. Christopher Dodd and Richard Shelby, the Democratic
chairman and senior Republican on the panel, respectively,
asked about the bill's "likely impact on the nation's capital
markets, including the potential effects on investor
protection, capital formation and other relevant issues."


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Cadence Design buyout talks stall over price-NYT

(Reuters) - At $6.5 billion, Cadence may be too expensive for the firms,
the Times said. The Times first reported interest in Cadence on
June 4.




Neither Blackstone, KKR nor Cadence immediately returned
calls seeking comment.


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India Infrastructure to Borrow $500 Million in Its First Overseas Loan

(Bloomberg) -- India Infrastructure Finance Co., the
state-owned lender that set up a fund with Blackstone Group LP and
Citigroup Inc., plans to borrow $500 million from a group of banks
in its first overseas loan.

The New Delhi-based company has hired BNP Paribas SA, Calyon
and Standard Chartered Plc to raise the 10-year, government-
guaranteed loan, said S.S. Kohli, chairman and managing director
at India Infrastructure. It will use the funds to finance roads,
airports, power plants and other infrastructure projects in the
South Asian nation.


Read more at Bloomberg Bonds News

Looming Crash Prompts Most Hires for Distressed-Debt Traders Since 2002

(Bloomberg) -- The biggest winners from the global
buyout boom are hiring distressed-debt bankers in Europe at the
fastest pace in five years.

Goldman Sachs Group Inc., the world's most profitable
securities firm, hired Andrew Wilkinson, the lawyer who advised
creditors in the bankruptcies of Eurotunnel Plc and Parmalat
Finanziaria SpA, to help lead its restructuring business in
London. Morgan Stanley, the third most-active merger adviser
this year behind Citigroup Inc. and Goldman, added seven bankers
in the past year, boosting its group to 61. Blackstone Group LP,
poised to become the world's largest publicly traded buyout
firm, is starting a corporate restructuring group in Europe.


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Blackstone seen paying up on CMBS deal

(Reuters) - Blackstone-EOP's sale, backed by Equity Office Property, is currently being marketed to investors by underwriters Goldman Sachs, Banc of America and Bear Stearns ahead of its pricing in June, market sources said.




The offering would be the second largest deal in the CMBS market this year, after Wachovia Securities' $7.9 billion sale in March.


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Small China steps could mean big Treasuries shift

(Reuters) - China has $1.2 trillion in foreign exchange reserves and holds $420.2 billion of U.S. Treasuries, making it the second biggest foreign holder after Japan.




The country's purchase of a $3 billion stake in U.S. private equity firm Blackstone Group is one confirmation that China is branching out into riskier assets in search of higher returns, and that its purchases of safer government bonds may diminish, analysts say.


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China to take $3 billion stake in Blackstone

(Reuters) - The agreement gives China's government a stake in the private equity boom sweeping the globe and hands a key alliance to Blackstone at a time foreign investors struggle to gain support from the Chinese government for takeovers of domestic assets.




The announcement comes just days before this week's planned visit to the United States by Chinese Vice Premier Wu Yi to discuss sticking points in trade. The talks are hosted by U.S. Treasury Secretary Henry Paulson.


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