Private Equity going Public

OK, I’m not speaking of a company privately owned that would filled for an IPO; although it is interesting to note that most of the attention lately has been on the reverse moves. I’m speaking of Blackstone intention to float their shares.

The move is interesting first because Blackstone is one of the biggest Private Equity firm in the world. Second because it could usher a new state of the art in Private Equity. A lot of the major Private Equity firms will soon face the same dilema: how to you turn from a small boutique who’s grown huge into a well-run professional company. Buy-Out firms, does this remind you something? The fact is that a lot of the current biggest PE firms have been founded in the last half-century by a bunch of financial entrepreneurs. A lot of these entrepreneurs are now reaching an age where most of the people already retired. So you have to solve a transition problem.

I find interesting that Blackstone decided to turn to the Public Market to solve this cash-out / maturity conundrum. I would find even more inspiring if the Carlyles of this world decided to turn Blackstone back from Public to Private in order to boost performance after a while; and educating if a Carlyle gone public ends-up merging with our frontrunner Blackstone.

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