The Blackstone Group will sell part of its shares to China's state foreign exchange investment company at its initial public offering (IPO) scheduled for Friday, the group announced Thursday.

Blackstone, one of the largest private equity firms in the U.S., announced the IPO of 133,333,334 common units priced at 31 U.S. dollars each, with a total value of 4.1 billion dollars. Its common units are slated to begin trading on Friday on the New York Stock Exchange, marking the biggest U.S. IPO in five years.

For such general corporate purposes as purchasing interests in its business from its existing owners, to repay short-term borrowings, to provide capital to invest in its existing businesses and to expand into new and complementary businesses, Blackstone said it is to implement the agreement with China's state foreign exchange investment company by selling its non-voting common units worth 3 billion dollars to the latter.

Blackstone and China's state foreign exchange investment company, the latter still in process of establishment, reached an agreement on May 20.

Under the agreement, the Chinese company will buy the shares at 95.5 percent of Blackstone's IPO price and hold them for at least four years while the deal will be closed concurrently with Blackstone's IPO.

Although the deal has been widely welcomed by Wall Street, some U.S. lawmakers, in a throwback to the Cold War, urged the U.S. Security and Exchange Commission (SEC), the Department of Treasury and the Department of Homeland Security to delay Blackstone's IPO due to what they called national security reasons.

In a letter to the SEC and the other two departments, Democratic senator Jim Webb said "in making this request, I express my concern regarding the enormity of this public offering and the large investment from a foreign government."

However, the SEC ignored his proposal and approved Blackstone's IPO, saying an IPO may be delayed only if a company had issued "material misstatements or omissions."

The Blackstone Group, a leading global alternative asset manager and provider of financial advisory services, deals with such businesses as the management of corporate private equity funds, real estate opportunity funds, hedge funds, mezzanine funds, senior debt funds, proprietary hedge funds and closed-end mutual funds.

It also provides financial advisory services on mergers and

acquisitions, restructuring, reorganization and fund placement services.

Source: Xinhua