Blackstone, world’s biggest private capital firm is planning to list its largest investments, a move that could reignite IPO markets.
Jonathan Gray, the president of New York’s listed investment giant, spoke today to Wall Street to give an update on its third quarter trading. He said that he expects IPOs to pick up in 2011 and plans to make some of his portfolio companies public.
Blackstone is the largest foreign investor in Britain and manages assets worth a record $1.1 billion globally.
Blackstone’s comments, although he is believed to be focusing more on its assets in the United States could increase confidence in European markets.
According to EY figures released last month, the total amount raised through IPOs globally fell by nearly a quarter during the first nine-month period of the year. It now stands at $77.6 Billion. The MSCI World Index has gained 18% so far this season.
There were only ten London listings in the UK during the first three-quarters. The total amount raised was £584.6, a 47 percent drop from the previous year.
In the last 20 years Blackstone invested more than £70billion in more than 100 British businesses and investments. The portfolio of Bourne Leisure includes Haven Holidays, Warner Leisure, Merlin Entertainments (the theme park group), Sage Homes (the affordable housing provider), and the National Exhibition Centre.
It started construction on a new European Headquarters in London of 226,000 sq ft, which is expected to be completed in 2028.
Jonathan Gray, Blackstone’s president, believes that the IPO market is going to pick up in the next few years.
Gray said on Thursday to Wall Street analysts that the IPO industry has been a laggard, with 2022-2023 being “very slow” years. However, he added that “as public markets increase in price it acts like a magnet attracting private companies.” So I believe you’ll start to see more.
He continued: “I walked in to a meeting yesterday, and we were discussing a possible IPO.” We’ve moved from a theoretical model to a practical one.
My expectation is that the historically cyclical IPO market will rebound. The private market is growing… I believe we will have a better IPO market by 2025.”
Gray made his comments as Blackstone beat Wall Street expectations with its quarterly update. The investor experienced $41 billion in capital inflows in the third quarter, and deployed and committed a total of $54 billion, the most in over two years. This was boosted by the Federal Reserve cutting interest rates.
Stephen Schwarzman said that the results were a sign of “a broad-based acceleration throughout our business”.
Blackstone shares closed at $169.59, up $9.88 or 6.2%, in New York, on Thursday.
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