Blackstone looks to advise startups

– Luisa Beltran is a contributor for PE Hub, a Thomson Reuters publication. This article originally appeared here. –

The Blackstone Group wants to advise, not buy, Silicon Valley startups.

So reports Portfolio.com. Blackstone has long had an advisory practice, but the New York private equity firm is known more for its mega buyouts. For example, Blackstone was part of the investor group that acquired Freescale Semiconductor in 2006 for $17.6 billion and also acquired Hilton Hotels in 2007 for $26 billion.

But Blackstone recently hosted an “inaugural” tech forum in Silicon Valley that was intended to match up startups, investors and industry experts, Portfolio.com reports. Ivan Brockman, a Blackstone MD who is based in Menlo Park, admits that Blackstone isn’t known for advising tech companies.

Brockman told Portfolio.com that the buyout shop wants to work with emerging disrupters or those companies that are “disrupting the status quo are those that are tackling current problems in a new way. Given the situation today, sometimes those emerging disrupters aren’t creating the market; they’re making it better,” he said.

In a Blackstone blog post from earlier this month, Brockman said cloud computing and mobility are causing a profound transformation in enterprise IT. Cloud computing is “changing the way we design and manage data centers and applications, how IT departments deliver capabilities to users, and how users access, select and interact with applications,” said Brockman.

Small private equity firms may get registration extension: SEC

The Securities and Exchange Commission appears ready to extend a transition period for some private equity firms and other investment advisers required to register with the agency under provisions in the Dodd-Frank financial reform law.

The changes have been the cause of much worry and harried preparation among advisers, particularly smaller and mid-sized private-equity firms subject to new requirements under the legislation.

SEC Associate Director Robert Plaze told Reuters the transition period would likely be extended, but stressed the agency had not yet acted.

peHUB: If CIT goes down, these companies may be hurting

peHUB’s Erin Griffith reports:

Buyouts Senior Editor Ari Nathanson and I compiled a list of buyout-backed companies which have used CIT as a lead arranger on its credit facility over the last three years, courtesy of Thomson Reuters data.

We came up with 38 companies.* Of those 38, CIT provided a revolver loan to all but two. For companies that haven’t drawn down their revolver (including this week’s run, which has only added to the company’s demise), the sudden disappearance of CIT could mean the sudden disappearance of all liquidity.

The interesting part is the amount of repeat business on the list. It brings new meaning to the “strong lender relationships” often touted by buyout pros. The one thing they don’t brag about is how a “strong relationship” with a failing lender could wind up being worse than no relationships!