Goldman Sachs Loves Blackstone - Just Starting Own Buyout Fund, That's All

Includes: BX, GS
by: Eddy Elfenbein

Eddy Elfenbein submits: Goldman Sachs Group Inc.'s (NYSE:GS) Chief Executive Officer Lloyd Blankfein said: "We happen to have as a firm a terrific relationship with Blackstone."

We're just going to start another gigantic buyout fund of our own, that's all.

GS' sixth buyout fund may top $20 billion, Chief Executive Officer Lloyd Blankfein told shareholders at today's annual meeting.

The fund, which is still raising money, will manage "about $19 to $20 billion of assets, maybe a little bit less, maybe a little more," Blankfein, 52, said at Goldman's Old Slip offices in New York yesterday. That would be more than twice the $8.5 billion fund closed by Goldman Sachs Capital Partners in 2005, which was a record at the time.

Goldman, the most profitable firm in Wall Street history, is raising the fund as Blackstone Group LP also aims to collect $20 billion for the biggest-ever buyout fund. Blackstone, which last week disclosed plans to sell shares worth as much as $4 billion in an initial public offering, didn't include Goldman among the six underwriters selected to manage the sale.

Blankfein said "We happen to have as a firm a terrific relationship with Blackstone" in answer to a question about why Goldman wasn't included as an underwriter. "It's impossible for us to be in every piece of business."