Despite buyouts remaining strong, concerns about the
tightening debt markets led Blackstone Group LP shares to close Tuesday below
Friday's initial public offering price. The stock
declined $1.69, or 5.2%, to $30.75, on the New York Stock Exchange after
dipping as low as $30.32. The buyout firm sold 153.3 million shares to the
public Friday for $31 each, raising $4.75 billion in the largest U.S. IPO in
five years. Although leveraged buyouts topped last week's biggest deal
announcements, investors fear that last week could be the beginning of the end
because of the high-yield debt market.
Buyers of high-yield debt are demanding
higher interest rates because they perceive LBOs might become riskier.
In related news, two big LBOs, ServiceMaster Co. and U.S. Foodservice Inc.,
postponed Wednesday's debt offerings.
For more about U.S. Foodservices, see TheDeal.com and The
Daily Deal later Wednesday. —Matthew Wurtzel
See
Blackstone shares story from Bloomberg
See
Blackstone IPO story from TheDeal.com
See
Deals of the Week from Dealscape
See
Servicemaster story from Reuters
See U.S. Foodservices story from Dealbook
