Mark DeCambre
Maybe, but maybe not. The limited partnership structure employed by Blackstone suggests that even as the cash rolls in, Blackstone's executives and direct institutional investor clients will benefit first. The IPO prospectus spells out that shareholders, after all, have few rights and little claim on the direction of Blackstone's strategy.
Fortress (FIG Quote - Cramer on FIG - Stock Picks) is a good case study. Its shares have been floundering as well, largely due to all the attention that private equity has drawn on Capitol Hill. Legislators have proposed a series of laws to increase taxes on these firms. Any taxes are likely to further undercut returns for private equity in the future. But at any rate, insiders are still first in line -- not public shareholders. With all due respect to Citi, now hardly seems like the time to throw your money in with Schwarzman & Co.
RSS
