Your article (“Blackstone diversifies, at least on one level,” Pensions & Investments, April 5) on Blackstone as an alternative asset manager concluded that we were still predominantly a private equity firm. Your conclusion, however, comes from a fundamental misreading of our financials.
In essence your chart on our fee income (from which you draw your conclusion) combines performance fees and regular fee income. We disclose the performance fees we accrue each quarter. But these are not received until the fund is closed and a final accounting can be made of a fund's total performance — often many years after we start accruing them. And during downturns in the economy, performance fees can turn negative as the portfolio is marked lower.
If you look at actual fee and interest income received in 2009, you find it equally distributed among our four principal businesses. See the chart below. There is no “identity crisis” at Blackstone. We set about to build the world's largest diversified alternative asset manager with a balance among our businesses and we have achieved that goal.
Managing director, public affairs
The Blackstone Group