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Blackstone To Change From Partnership To Corporation; Q1 Profit Up 34%

Blackstone (BX) announced conversion from a publicly traded partnership to a corporation, expected to be effective July 1, 2019. The company said this paves the way for equity value appreciation by removing ownership restrictions and by expanding global investor universe. Blackstone expects the conversion to produce significant potential benefit at relatively modest additional tax cost. Estimated annual dilution to distributable earnings per common share is approximately 2-5% on an average over the next 5 years. Over the longer term, the dilution is projected to be approximately 12-13%.

Stephen Schwarzman, CEO, said, "We believe the decision to convert will make it significantly easier for both domestic and international investors to own our stock and should drive greater value for all of our shareholders over time."

For the first-quarter, distributable earnings were $538 million or $0.44 per unit, up 7% year-over-year. Fee related earnings were $374 million or $0.31 per unit, up 11%. Net income per common unit was $0.71, an increase of 34% over prior year. On average, 13 analysts polled by Thomson Reuters expected the company to report profit per share of $0.53 for the quarter. Analysts' estimates typically exclude special items.

First-quarter total revenues were $2.03 billion, up 14% from prior year. Total investment income rose 9% to $1.15 billion. Total Assets Under Management was $511.8 billion, up 14% from previous year.

Blackstone has declared a quarterly distribution of $0.37 per common unit to record holders of common units at the close of business on April 29, 2019. This distribution will be paid on May 6, 2019.

Shares of Blackstone were up more than 3% in pre-market trade on Thursday.

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