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BLACKSTONED ContentsPreface .......................................................................................1The benefits of going public........................................................ 3Blackstoned ................................................................................ 5

A different kind of company ........................................................ 7

History repeats itself ................................................................... 8

A Netscape moment ................................................................. 10

You can't fool the public............................................................ 12

Luck or genius? ........................................................................ 13

Living on borrowed time ........................................................... 14

Moving the goal posts............................................................... 16

A (fictional) letter from Stephen Schwarzman on the proposedLBO of Blackstone Group ......................................................... 18

About us ..................................................................................24

Get breakingviews ..................................................................24

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This is not acceptable to us. Nor can we comply with thedemands by our Chinese minority investors for seniormanagement changes. Instead, my partners and I are offering

to purchase all the Group's outstanding common units.Although the offer is well below the flotation price, it representsa substantial premium to where the securities have tradedlately.

Of course, no binding obligation on the part of the undersignedor the Group shall arise with respect to the proposal or anytransaction unless and until a definitive agreement satisfactoryto us and recommended by the Special Committee and

approved by the Board of Directors is executed and delivered.

We look forward to discussing our proposal with you further inthe near future.

Very truly yours,Stephen Schwarzman

Published 13 June 2007

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About us

Breakingviews.com is the world's leading source of agenda-setting financial insight. We have 27 correspondents andcolumnists based in London, New York, Paris, Washington,Madrid and Brussels. Our aim is to become the lingua franca forthe global financial elite. Our real-time subscription servicecurrently reaches around 15,000 financial professionals such asinvestment bankers, senior corporate executives, hedge fundmanagers, lawyers and private equity professionals. We reacha broader audience of nearly 4.5m investors and opinion-

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Copyright 2008