Blackstone: top of the world

The Blackstone Group was the only real candidate for the inaugural Editors’ Awards in Private Equity International’s annual poll, despite fierce competition in the large buyout firm of the year category.

In 2006 The Blackstone Group was ubiquitous. And in a tight pack of mega buyout firms it set the pace, which is why it won Private Equity International’s inaugural Editors’ Award for large buyout firm of the year.

The firm was hyperactive on the deal front, while at the same time targeting some $20 billion in fresh powder for more deals.

Publicly the firm dismissed claims that it was looking for bragging rights, but it did coincidentally turn to investors for a little extra capital, shortly after TPG closed the world’s biggest buyout fund.

Schwarzman: “King of Wall Street”

It is set to close on an extra $5 billion to take the fund to around £20 billion, putting it at the top of the pile. Sources say this is so the firm does not run out of capital prematurely and leave investors with a missing year of Blackstone mega deals.

And let’s not forget, despite its prodigious fundraising effort, this firm is all about deals. And make no mistake, it is popular with service providers to the deal economy.

According to data provider Dealogic Blackstone paid $622 million in fees to investment banks worldwide in 2006, more than any other buyout firm. It led the way in M&A activity and was third globally in loan financing.

Interestingly, Blackstone’s biggest announced deal was in real estate: Equity Office Properties. With KKR, TPG, Goldman Sachs and Carlyle all raising enormous funds for 2007, Blackstone will have plenty of competition to keep its dealmakers sharp.

It has, temporarily, lost its title for the world’s largest buyout to KKR and TPG, which are buying US utility TXU. Blackstone meanwhile is consolidating the theme park market, with one of its latest deals bringing together its portfolio firm Merlin and the Tussauds waxwork empire.

It is also frontrunner to help disentangle US carmaker Chrysler from its German parent. This deal is said to be worth around €10 billion. Time was when this would have set records. Now, thanks to Blackstone’s efforts, it looks like small change.

If Stephen Schwarzman, Blackstone’s co-founder, has been crowned the “King of Wall Street,” by his domestic press, then he surely must have seen that as an epithet of constraint in 2006.

To judge by his firm’s early efforts in 2007 he is looking to extend his reign.