Blackstone's Loss Triggered By Investment Declines By Dan Freed TheStreet.com Senior Writer 5/15/2008 1:11 PM EDT

The Blackstone Group (BX) saw a loss of $93.6 million, or 97 cents per unit, in the first quarter due to a drop in the value of investments the world's largest private equity firm holds on its balance sheet.

"Turbulent markets throughout the world persisted in the first quarter, affecting virtually all asset pricing across credit and equity markets," said Stephen Schwartzman, Blackstone's chairman and SEO, in a company press release.

Schwartzman said the positive side of the decline in asset prices is it has created investment opportunities, notwithstanding the difficulty of raising debt for the large buyouts that are Blackstone's bread and butter. In particular, Schwartzman highlighted Blackstone's acquisition of GSO Capital Partners, an alternative investment firm that will help Blackstone buy beaten down debt obligations from the investment banks. Blackstone paid $930 million for GSO, a deal that was announced in January.

Blackstone's loss, on revenue of $68.5 million compares to a gain of $957.8 million on revenue of $1.2 billion a year ago, when Blackstone was still a private company. Blackstone went public in June, though its publicly listed equity securities, called units, are different from traditional common shares. Blackstone's unit holders have fewer rights than traditional shareholders, for example.

Blackstone's unit price was down slightly to $19.38 in midday trading.

RELATED STORIES
Accounting Changes Hide Freddie's Flaws
IndyMac Sputters to Loss
MBIA Shares Rise, Despite Big Loss

Read our conflicts and disclosure policy.