Blackstone CEO’s $3,000 food spree and $40 crab claws
As Blackstone settles into the pre-IPO “quiet period,” a Wall Street Journal article made a loud bang on Wednesday. The Journal highlights Stephen Schwarzman’s worth (expected to be more than $7.7 billion after the IPO), his size (5 foot 6 inches) and his competitive streak (he is quoted as saying, he wants to “inflict pain” on and “kill off” his rivals).
Better yet, the Journal article reveals some of Blackstone CEO’s extravagances, which may not go over too well with lawmakers in Washington and various European capitals who are seeking to get a grip on the huge riches that private equity executives are hauling in. The Journal points out:
“He expects lunches consisting of cold soup, a cold entrée such as lobster salad or fresh grilled tuna on salad, followed by dessert, Mr. Zeugin (his executive chef) says. He eats the three-course meal within 15 minutes, the chef says.”
“Mr. Zeugin says he often spends $3,000 for a weekend of food for Mr. Schwarzman and his wife, including stone crabs that cost $400, or $40 per claw. (Mr. Schwarzman says he had no idea how much the crabs cost.) Recently, Mr. Zeugin has been ill and is no longer working, although he is still on Mr. Schwarzman’s payroll.”
“Once, while sunning by the pool at his 11,000-square-foot home in Palm Beach, Fla., hecomplained to Jean-Pierre Zeugin, his executive chef and estate manager, that an employee wasn’t wearing the proper black shoes with his uniform, according to Mr. Zeugin. Mr. Schwarzman explains that he found the squeak of the rubber soles distracting.”
The Journal even quoted his mother.
“As Mr. Schwarzman weighed whether to take his firm public, he told his family they would make a financial killing, but could be under more scrutiny, says his mother, Arline. A family member asked him: “Do we need any more money?” Arline Schwarzman says she interrupted: “You don’t understand what drives him. Money is the measuring stick.”
Schwarzman also goes through great lengths to protect his ego, apparently. Here is how he reportedly handled the prospect of roasting at his 60th birthday gala.
“Mr. Schwarzman had no qualms about stage managing the accolades. When Blackstone colleagues prepared a video tribute, he sought to squelch any roasting, asking his peers not to poke fun at him. “Happy Birthday, Steve,” David Rubenstein, co-founder of rival buyout firm Carlyle Group, said on the video. “I wish you would retire so you wouldn’t compete with us on deals.”
But let’s forget the money, the attitudes, the ego for a second. Will the $400 crab be the symbol that kills the attractive tax regime for the entire private equity industry? After reading this article, some regulators may want to get their claws into the buyout boom.
(Photos: Top left, Reuters file. Bottom right, Stephen Schwarzman, handout)