8-K
Blackstone Inc. (BX)
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 14, 2021
The Blackstone Group Inc.
(Exact name of Registrant as specified in its charter)
| Delaware | 001-33551 | 20-8875684 |
|---|---|---|
| (State or other jurisdiction<br> <br>of incorporation) | (Commission<br> <br>File Number) | (I.R.S. Employer<br> <br>Identification No.) |
| 345 Park Avenue<br> <br>New York, New York | 10154 | |
| --- | --- | |
| (Address of principal executive offices) | (Zip Code) |
(212) 583-5000
(Registrant’s telephone number, including area code)
NOT APPLICABLE
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| --- | --- |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading<br> <br>Symbol(s) | Name of each exchange<br> <br>on which registered |
|---|---|---|
| Common Stock | BX | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 7.01 Regulation FD Disclosure.
On July 14, 2021, The Blackstone Group Inc. (“Blackstone”) issued a press release announcing the transaction described below under Item 8.01 of this Current Report on Form 8-K. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
The information in Item 7.01 of this Current Report on Form 8-K, including the press release attached hereto as Exhibit 99.1, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section. Furthermore, such information shall not be incorporated by reference into any filing or other document pursuant to the Securities Act of 1933, as amended (the “Securities Act”), except as shall be expressly set forth by specific reference in such filing or document.
Item 8.01 Other Events.
On July 14, 2021, Argon Holdco LLC (“Buyer”), an entity affiliated with Blackstone, entered into a stock purchase agreement (the “Stock Purchase Agreement”) with American International Group, Inc. (“AIG”), pursuant to which Buyer has agreed to acquire a 9.9% equity interest in SAFG Retirement Services, Inc. (the “Company”) for an aggregate purchase price of $2.2 billion in cash, subject to purchase price adjustments (the “Transaction”). The Company is expected to be the parent company of AIG’s life and retirement business (“AIG L&R”) at the time of the anticipated initial public offering of AIG L&R, which AIG has previously announced it is pursuing.
In connection with the closing of the Transaction contemplated by the Stock Purchase Agreement, Blackstone ISG-I Advisors L.L.C. (the “Investment Manager”) will enter into a long-term strategic asset management partnership with certain subsidiaries of the Company, pursuant to which the Investment Manager will serve as the exclusive external manager for such subsidiaries with respect to the following asset classes within their investment portfolio: (1) non-agency residential mortgage-backed securities, commercial mortgage-backed securities and asset-backed securities; (2) collateralized loan and debt obligations, leveraged loans and certain other loans; (3) asset-backed whole loans and direct lending; (4) private high grade, project finance, including renewable energy, and other long-dated investments; and (5) alternatives, including real estate equity (the “SMA Agreement”). Pursuant to the SMA Agreement, the Company has agreed to have the Investment Manager manage an initial $50 billion of assets under management of the Company and its subsidiaries, with such amount increasing to $92.5 billion over years two through six of the SMA Agreement’s initial commitment period. The capital is expected to be primarily invested in Blackstone-originated assets. Following the initial commitment period of six years, the strategic asset management partnership will renew subject to long-term relative performance measures by asset class.
In connection with the Transaction, Blackstone will be entitled to one seat on the board of directors of the Company. Subsequent to the anticipated initial public offering of AIG L&R, Blackstone will hold publicly traded common stock subject to certain phased lock-up provisions.
Consummation of the Transaction is subject to the satisfaction or waiver of certain closing conditions, including the expiration or termination of the applicable waiting period under the Hart-Scott Rodino Antitrust Improvements Act of 1976, as amended, and the entry into the SMA Agreement.
This Current Report on Form 8-K may contain forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, which reflect our current views with respect to, among other things, our operations, taxes, earnings and financial performance, share repurchases and dividends. You can identify these forward-looking statements by the use of words such as “outlook,” “indicator,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “scheduled,” “estimates,” “anticipates” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. We believe these factors include but are not limited to the impact of the novel coronavirus (“COVID-19”), as well as those described under the section entitled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2020, as such factors may be updated from time to time in our periodic filings with the United States Securities and Exchange Commission (“SEC”), which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this report and in our other periodic filings. The forward-looking statements speak only as of the date of this report, and we undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Description |
|---|---|
| Exhibit 99.1 | Press release of The Blackstone Group Inc. dated July 14, 2021. |
| Exhibit 104 | The cover page from this Current Report on Form 8-K, formatted in Inline XBRL. |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: July 14, 2021
| The Blackstone Group Inc. | |
|---|---|
| By: | /s/ John G. Finley |
| Name: | John G. Finley |
| Title: | Chief Legal Officer |
EX-99.1
| Exhibit 99.1 |
|---|
AIG Contacts:
Quentin McMillan (Investors): Quentin.Mcmillan@aig.com
Dana Ripley (Media): Dana.Ripley@aig.com
Blackstone Contacts:
Weston Tucker (Investors): Weston.Tucker@blackstone.com
Matt Anderson (Media): Matthew.Anderson@blackstone.com
AIG Announces Strategic Partnership with Blackstone for its Life & Retirement Business and Sale to Blackstone of Certain AffordableHousing Assets
| • | AIG to Sell 9.9% Equity Stake in its Life & Retirement Business to Blackstone for $2.2 Billion<br> |
|---|---|
| • | AIG and Blackstone to Enter into a Strategic Asset Management Relationship for a Portion of the Life &<br>Retirement Investment Portfolio |
| --- | --- |
| • | AIG to Sell Certain Affordable Housing Assets to Blackstone Real Estate Income Trust, Inc. for $5.1 Billion<br> |
| --- | --- |
| • | Transactions Provide AIG with Significant Financial Flexibility and Support AIG’s Progress toward Separating<br>its Life & Retirement Business |
| --- | --- |
NEW YORK – July 14, 2021 – American International Group, Inc. (NYSE: AIG) and Blackstone (NYSE: BX) today announced that they have reached a definitive agreement for Blackstone to acquire a 9.9% equity stake in AIG’s Life & Retirement business for $2.2 billion in an all cash transaction.
As part of this agreement, AIG also agreed to enter into a long-term strategic asset management relationship with Blackstone to manage an initial $50 billion of Life & Retirement’s existing investment portfolio upon closing of the equity investment, with that amount increasing to $92.5 billion over the next six years.
Upon the closing of these transactions, which are expected to occur simultaneously by the end of the third quarter of 2021, Jon Gray, President and Chief Operating Officer of Blackstone, will join the Life & Retirement Board of Directors. These transactions are subject to HSR approval and other customary closing conditions.
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Separately, AIG and Blackstone Real Estate Income Trust (BREIT), a long-term, perpetual capital vehicle affiliated with Blackstone, also announced today that they have reached a definitive agreement for BREIT to acquire AIG’s interests in a U.S. affordable housing portfolio for approximately $5.1 billion, in an all cash transaction. This transaction is subject to customary closing conditions and is expected to close in the fourth quarter of 2021.
“Today’s announcement is an important milestone for AIG. Establishing a cornerstone partnership on several fronts with such a highly regarded organization as Blackstone validates the strength of our market-leading Life & Retirement business and provides it with additional growth opportunities, provides AIG with flexibility as we continue to work to separate Life & Retirement from AIG, and results in significant new capital for AIG to deploy to support our capital management priorities,” said Peter Zaffino, President and Chief Executive Officer of AIG.
Mr. Zaffino added: “AIG has stewarded the Affordable Housing portfolio for more than 30 years. While the highly specialized assets subject to this transaction are attractive investments, they are no longer core to AIG’s long-term investment strategy. We believe Blackstone has the right expertise and commitment to stakeholders to manage these assets going forward.”
“We look forward to a productive and value-enhancing partnership with Blackstone as we continue to build momentum on our journey to become a top performing company.”
Jon Gray said: **** “We are honored to become AIG’s strategic partner, supporting the growth and success of one the world’s top life insurers as a standalone business. We believe our leading private credit origination platform will play an important role to help meet long-term policyholder obligations while maintaining strong credit quality.”
Kathleen McCarthy, Global Co-Head of Blackstone Real Estate, commenting on the real estate transaction, added: “These communities provide critical affordable housing and we look forward to being long-term owners. We will make significant investments to improve the apartments while ensuring they remain affordable and in compliance with all rent regulations. We are committed to working with our partners in this sector to expand the supply of affordable housing.”
AIG’s financial advisors with respect to the Life & Retirement transactions are Evercore and J.P. Morgan Securities LLC, and its legal advisors are Wachtell, Rosen, Lipton & Katz and Debevoise & Plimpton LLP. With respect to the sale of the Affordable Housing portfolio, CBRE Capital Advisors, Inc. acted as AIG’s financial advisor, and its legal advisors are Sullivan & Cromwell LLP, Nixon Peabody LLP and Elkins Kalt Weintraub Reuben Gartside, LLP.
On the Life and Retirement transactions, Goldman Sachs served as financial advisor, and Simpson Thacher & Bartlett LLP and Skadden, Arps, Slate, Meagher & Flom LLP served as legal advisors to Blackstone. With respect to the Affordable Housing portfolio transaction, Blackstone’s financial advisors were Eastdil Secured, J.P. Morgan Securities LLC and Morgan Stanley & Co. LLC and legal advisors were Simpson Thacher & Bartlett LLP and Jones Day.
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About AIG
American International Group, Inc. (AIG) is a leading global insurance organization. AIG member companies provide a wide range of property casualty insurance, life insurance, retirement solutions, and other financial services to customers in more than 80 countries and jurisdictions. These diverse offerings include products and services that help businesses and individuals protect their assets, manage risks and provide for retirement security. AIG common stock is listed on the New York Stock Exchange.
Additional information about AIG can be found at www.aig.com | YouTube: www.youtube.com/aig | Twitter: @AIGinsurance www.twitter.com/AIGinsurance | LinkedIn: www.linkedin.com/company/aig. These references with additional information about AIG have been provided as a convenience, and the information contained on such websites is not incorporated by reference into this press release.
AIG is the marketing name for the worldwide property-casualty, life and retirement, and general insurance operations of American International Group, Inc. For additional information, please visit our website at www.aig.com. All products and services are written or provided by subsidiaries or affiliates of American International Group, Inc. Products or services may not be available in all countries and jurisdictions, and coverage is subject to underwriting requirements and actual policy language. Non-insurance products and services may be provided by independent third parties. Certain property-casualty coverages may be provided by a surplus lines insurer. Surplus lines insurers do not generally participate in state guaranty funds, and insureds are therefore not protected by such funds.
About Blackstone
Blackstone is one of the world’s leading investment firms. We seek to create positive economic impact and long-term value for our investors, the companies we invest in, and the communities in which we work. We do this by using extraordinary people and flexible capital to help companies solve problems. Our $649 billion in assets under management include investment vehicles focused on private equity, real estate, public debt and equity, life sciences, growth equity, opportunistic, non-investment grade credit, real assets and secondary funds, all on a global basis. Further information is available at www.blackstone.com. Follow Blackstone on Twitter @Blackstone.
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