The New Biggest P.E. Deal Ever

Nov 20 2006 | 10:21am ET

What can $36 billion buy?

How about the largest publicly-held office building owner?

In the largest private equity transaction in history, The Blackstone Group’s real estate affiliate will acquire Equity Office Properties Trust, which owns all or parts of nearly 600 buildings in 16 states and Washington, D.C., for that astronomical amount, shattering the record, set this summer, by the $33 billion deal for hospital operator HCA, led by Bain Capital and Kohlberg Kravis Roberts.

“We are extremely excited about this landmark transaction with Equity Office, which represents the largest private equity deal in history,” Blackstone senior managing director Jonathan Gray said.

Under the deal, Blackstone Real Estate Partners will pay $48.50 per share—an 8.5% premium—in cash, pending approval by Equity Office’s shareholders. The deal is expected to close early next year.

“We’ve built a great company—epitomized by the caliber of our employees, the quality of our assets and the markets where we operate,” Equity Office President and CEO Richard Kincaid Said. “Our ultimate goal has always been to maximize shareholder value, and we believe we have done that through this transaction with The Blackstone Group.”

An all-star cast of Wall Street banks advised on the deal, with Merrill Lynch working with Equity Office and Goldman Sachs, Bank of America, Morgan Stanley and Blackstone Corporate Advisory on Blackstone’s side. Goldman, BofA and Bear Stearns will lead Blackstone’s acquisition financing.


In Depth

Debunking Conventional Investment Wisdom

Feb 8 2017 | 3:22pm ET

Due diligence in the hedge fund world has long involved some combination of the...

Lifestyle

'Tis the Season: Wall Street Holiday Parties Back In Fashion

Dec 22 2016 | 9:23pm ET

Spending on Wall Street holiday parties has largely returned to pre-2008 levels...

Guest Contributor

The Future of Private Equity: New Opportunities, New Challenges

Feb 3 2017 | 6:41pm ET

The private equity industry’s astonishing rebound since the financial crisis has...

 

From the current issue of