Mon, Jul 09, 2007 - Page 12 News List

Blackstone Group denies setting up a unit in Taiwan


The Blackstone Group denied yesterday that it has set up a local unit.

The denial came in a story in the Chinese-language Apple Daily about a Kaohsiung-based businessman who claimed he was an exclusive representative for the US private equity fund, which has been in the limelight lately because of several huge transactions.

The paper said man may have defrauded about 50 people of millions of NT dollars since May.

Blackstone spokesman John Ford told the newspaper that the company has not set up any office in this country and has not entrusted any local institutions to raise funds or sell its products.

Blackstone has started an investigation, Ford said.

The Apple Daily said Lee Kuan-jin (李冠謹) required employees to invest NT$500,000 (US$15,250) to NT$2 million before they could start work, according to an employee who reported the alleged fraud.

Lee told the newspaper that he could guarantee an annual return of 40 percent to investors and had raised NT$700 million in the past two months.

Ford said Blackstone does not raise small funds from individuals, but from institutional investors with minimum investment of US$25 million to US$50 million.

The Financial Supervisory Commission said Lee could have broken several laws. If tried and convicted, he could face up to seven years in jail, plus a maximum fine of NT$500 million.

Blackstone is one of the world's top buyout firms, managing approximately US$88.4 billion in assets. The company made its debut in the US stock market last month, raising US$4.1 billion in the biggest initial public offering in five years.

Blackstone also announced last week it had reached a deal to purchase Hilton Hotels Corp for US$20.1 billion.

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