Blackstone's Strategic Move into Accounting

In a landmark move, Blackstone, the private equity behemoth managing a staggering $1 trillion in assets, is spearheading a $2 billion acquisition of a majority stake in Citrin Cooperman, a prominent US accounting firm. This acquisition marks Blackstone's inaugural foray into the accounting sector, signaling a significant diversification of its investment portfolio.

Deal Dynamics and Valuation Insights

The transaction sees Blackstone acquiring the stake from New Mountain Capital, Citrin Cooperman's previous majority owner. The deal pegs the firm's valuation at over $2 billion, reflecting a valuation multiple of approximately 15 times its EBITDA. This represents a notable uptick from the 11 times multiple at which New Mountain Capital initially acquired the firm, underscoring the robust growth and profitability trajectory of Citrin Cooperman.

Regulatory Considerations and Future Outlook

In a strategic move to navigate regulatory concerns regarding audit independence, the investor group, inclusive of smaller stakeholders, will hold over two-thirds of Citrin Cooperman, with Blackstone's stake maintained below the 50% threshold. This arrangement ensures compliance while facilitating Blackstone's strategic objectives. An official announcement is anticipated imminently, heralding a new chapter for Citrin Cooperman under the aegis of Blackstone's expansive investment umbrella.