The private equity giant Blackstone Group stands to rake in more than $4.14 billion Friday in one of the largest initial share offerings in history.
The auction starts Thursday night when Blackstone will offer a price to investors on the New York Stock Exchange. Blackstone's plan to go public will effectively raise capital for future investments. It also gives Blackstone's managers millions of dollars in cash in exchange for turning over a small portion of the company without losing any control.
The company is selling 12.3 percent of its management arm, and investors will get very few voting rights in the overall group.
The private equity firm is looking at a price between $29 to $31, which analysts have seen hold steady for the past month. The banks will be allowed to sell another 20 million shares to meet excess demand.
In addition, Blackstone has a $3 billion investment from the government of China, bringing the total cash infusion to more than $7 billion.
Morgan Stanley and Citigroup will serve as joint underwriters for the 133.3 million shares offered and will co-manage with a host of financial heavy hitters that include Goldman Sachs, Merrill Lynch and Dutch bank ABN Amro Rothschild.
Though Blackstone's offering is significant, it will still fall short of being America's single largest IPO. That honor goes to AT&T Wireless Group's IPO in 2000, which raised $10.6 billion.
On the world stage, even that is small potatoes. The Industrial and Commercial Bank of China Ltd. (ICBC), China's largest bank and the world's fifth-largest, pocketed $21.9 billion when it went public on the Shanghai and Hong Kong stock exchanges last October.