Blackstone's Debut Leaves Some Disappointed

When Peter Cohan, who writes the The Cohan Letter and is president of a management consulting and venture capital firm predicted on Thursday that Blackstone Group LP (BX) shares would end their first day of trading at US$90, he was probably thinking back to Fortress Investment Group LLC's (FIG) initial 68% jump back in February 2007.

Perhaps reports that Blackstone's offering was seven times oversubscribed got him.

Or maybe it was news suggesting that Kohlberg Kravis Roberts & Co. is preparing its own initial public offering.

Needless to say, with Blackstone units hovering near the US$35 range, up roughly 13% from its IPO price of US$31 after spiking much higher when the market opened, Mr. Cohan must be disappointed.

BX intraday chart:

Comments

[Totally a b...:]

Dear Mr. Cohan:

[INAPPROPRIATE LANGUAGE REMOVED BY THE SEEKING ALPHA EDITORS]
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BX is hurrying its IPO not knowing what could happen to the market next week... Another bubble which will really hurt the market...

Jim Jubak: Blackstone IPO Is a Must-Miss
www.thestreet.com/pf/n...

Why FIG was a bad IPO (must read):
www.thestreet.com/_yah...

Both FIG and BX knows that they are at the top of the private equity cycle. Cannot get any better and will only get worst as debt (required to take companies private) is not cheap anymore and becoming more expensive to leverage as interest rates are rising.

Also most of you should know that BX is not selling their attractive funds/equity portions of the business. They are selling a small portion of the company which manages these funds/equity. And this company will have a market cap of $40 billion. Imagine if BX was bringing to public their core business, what would its market cap be...?

But do keep companies like these in your super-short lists: BX, FIG, INFN, CAVM, ATV, LLNW, NMX, ENOC, ARUN. Will def. come in handy when the bubble bursts again.
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And this is response to someone on ipohome.com [INAPPROPRIATE LANGUAGE REMOVED BY THE SEEKING ALPHA EDITORS]
who predicts BX hitting 121 a share:

> This one I feel atleast has the potential to double. Im on a limb
> once again... this one will see 121 a share.....within 4 months
> sponge

At $121, it will be close to $140billion market cap, almost twice as big as Goldman Sachs. And that too, only the management arm of Blackstone. So what would you value the entire Blackstone group. You are a plain idiot who may have got lucky with MA and now enticing others to buy at current levels to help your cause.

If you say double from here, even at $75, it will be nearly as big as GS which had $69 Billion in 2006 revenues and nearly 10billion in profits - GS profit alone is more than BX revenues. And BX revenues are only going to get worst with interest rates rising and the new BlackStone Tax law which the two senators are fighting about with the SEC.

And finally MA trading at $166 with a astronomical PE of 160+ looks cheap in front of BX even though it is small revenue wise. But it has a stable consumer oriented business and one of the only 3 leading credit card companies. BTW, I am short on MA.

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2007 Jun 25 03:22 PM

[Totally a b...:]

IMO the only reason this IPO got done at this lofty levels is because the extremely smart crooks at BX somehow convinced State of China to invest in BX. As a naive or even a savvy US investor you would consider Chinese to be very smart/shrewed with their money and if they are putting USD 3 billion at stake, they def. have seen something in the company, so why not just invest $5k/10K of your own.

My sympathies to the people who bought in at the open, but I would really like to see it trade below $29 and see how the chinese gov. reacts to it. They have agreed not to sell their units for 4 years. But will they keep their side of the bargain ? I do think they will but it would be interesting...

2007 Jun 25 03:32 PM

[Totally a b...:]

Dear Mr. Cohan, seeking alpha editors wants me to use "nice" words. So here is another attempt.

Dear Mr. Cohan
We are so inspired by your call for Blackstone (BX) to hit $90 on first day. Sir, if we may ask, where did you do your management from, huh ? Or maybe its time to go to school again. Do WE have any sense left at all, Sir ?

I and many others w/o management degree had better insight and sense to evaluate the company better. What were you thinking, kind Sir ?

Please refer to first comment for the rest of the post...
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Seeking Alpha, does this work for you ?

2007 Jun 25 09:19 PM