Blackstone is spinning off its M&A and restructuring advisory business. The business unit will be combined with independent financial advisory firm PJT Partners, headed up by Paul Taubman. Taubman was previously a banker at Morgan Stanley.
The spin out also includes Blackstone’s Park Hill fund placement business. The transaction is expected to close in the first quarter of 2015.
The new entity will be an independent, publicly traded company. Once the transaction closes, Blackstone shareholders will own approximately 65 percent of the new entity. The remaining interest will be owned by Taubman and existing Blackstone financial advisory employees.
Blackstone initially began as an advisory firm 30 years ago and has moved more decisively into investing in recent years. The new entity will not be prohibited from launching its own investment capability down the road.
“As the largest alternative asset manager in the world, and with our investing areas considerably broader and larger than even a few years ago, we have not been free to aggressively grow our advisory businesses further out of concern for potential conflicts. The separation of our investing and advisory areas will create new growth opportunities for both businesses,” Stephen A. Schwarzman, Blackstone’s chairman, CEO and co-founder, said in a statement.
Excluding capital markets revenues attributable to Blackstone’s financial advisory segment that will not be part of the transaction. Blackstone’s advisory businesses generated approximately $380 million of revenue for the twelve months ending June 30, 2014.