Blackstone (and its securities lawyers) explain why Blackstone is going public

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Here we go, straight from the SEC filing:

Why We Are Going Public

We have decided to become a public company:

• to access new sources of permanent capital that we can use to invest in our existing businesses, to expand into complementary new businesses and to further strengthen our development as an enduring institution;

• to enhance our firm’s valuable brand;

• to provide us with a publicly-traded equity currency and to enhance our flexibility in pursuing future strategic acquisitions;

• to expand the range of financial and retention incentives that we can provide to our existing and future employees through the issuance of equity-related securities representing an interest in the value and performance of our firm as a whole; and

• to permit the realization over time of the value of our equity held by our existing owners.

This strikes me as a pretty honest account. The last bullet point of course means: So the already very rich partners can get dramatically richer.

The document goes on to describe how “we intend to be a different kind of public company”–that is, one that thinks long-term and doesn’t worry if its earnings are up one quarter and down the next. This is where the whole going-public thing gets a little ironic: By taking public companies private, firms like Blackstone say they are able to focus the management on long-term goals rather than quarterly earnings. Yet here is Blackstone saying it can do that even while being traded on the stock exchange. Ah well, foolish consistency is the hobgoblin of little minds.

Update: I finally got down to the potentially juiciest part of the document, the executive compensation table. It’s blank. I guess they won’t give those numbers out until they’re absolutely, positively, indubitably sure they’re going public. It is disclosed that Stephen Schwarzman’s salary will be $350,000. But that’s just the money he uses to tip coat-check ladies.

Update 2: The breakingviews gang predicted in this morning’s Wall Street Journal that Schwarzman might take no salary in exchange for a bigger equity stake (I can find links neither at nor I’d say they were correct within a rounding error. Update 2.5: Here‘s the link, plus an FT Alphaville post that expands on the topic. Much thanks to Alphaville‘s Paul Murphy for pointing me to it.

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