Blackstone to settle flotation case for $85m

Michael Bow
Follow Michael
BLACKSTONE, the co-owner of the city’s Broadgate estate, will pay $85m (£54.8m) to settle a longstanding lawsuit surrounding its 2007 initial public offering, it emerged yesterday.

The Wall Street firm, established by legendary dealmaker Steve Schwarzman in the 1980s, will avoid a potentially fraught courtroom showdown scheduled for 16 September after agreeing to settle with the group of claimants.

The case revolves around Blackstone’s huge $4.7bn 2007 flotation, and how the company disclosed the value of three of its portfolio company.

The claimants, led by Landmen Partners, said they should have disclosed a decline in their values. They were seeking $690m from the trial. The $85m settlement is about 12 per cent of this total.

The claim was filed at a time when Blackstone’s share price was in the doldrums.

It had dropped to $7.75 a share from an IPO price of $31 when the claim was filed in October 2008. Yesterday its share price closed up 1.39 per cent at $21.95.