Mr £570m
Ruthless tycoon who cashes in on turmoil is America’s best paid boss
BLACKSTONE Group’s founder is on course to be America’s best- paid boss this year after pocketing £570m.
The private equity titan’s boss stephen schwarzman got a base salary of £253,500, beyond the dreams of most ordinary people but relatively low for leading chief executives in the Us.
But this was dwarfed by a £91m bonus pay-out and £479m in dividends from his 19pc stake in the company. It puts him on track to be the country’s top earner, eclipsing snapchat founder Evan spiegel who got £461m.
The 71- year- old launched Blackstone in 1985 with banker Pete Peterson, who had been commerce secretary under disgraced President Richard nixon. schwarzman has since built the firm into a £314bn empire with holdings in everything from hotels and theme parks to publishers and tech firms.
But schwarzman is no stranger to controversy. The Blackstone chief was accused of profiteering at the expense of the elderly and vulnerable when he made almost £500m after his company sold its interest in southern cross, Britain’s biggest care home provider.
The deal involved the sale of the group’s properties, forcing southern cross to lease them back from another company. The business ended up saddled with expensive long-term rent commitments and went bust in 2012, leaving thousands of residents fearing for their futures.
schwarzman was born into a middle- class family to a father who ran a Philadelphia dry goods store. He won a place at Yale University where he joined its skull and Bones secret society.
After graduating he met William Averell Harriman, a Democrat politician, the son of a railroad baron and a former skull and Bones member, who advised schwarzman to become independently wealthy if he wanted to succeed in life.
so the aspiring leader went into investment banking, deciding high finance was for him, because, as he later said, ‘if you have such great-looking girls and intense guys then I want to do it’. schwarzman – who is today worth £9.2bn – wound up working for Peterson at Lehman Brothers and built a reputation as one of its top dealmakers.
colleagues even bought him a framed flattering newspaper profile with a mirror attached so that he could read it and look at himself at the same time.
And when his boss was forced out in an internal power struggle, schwarzman followed to work on a new venture. He came up with the name Blackstone from their two names, because ‘schwarz’ is German for black and ‘petros’ means stone in Greek.
schwarzman gradually took over from Peterson following decades of growth, and made a fortune when the business went public in 2007.
The billionaire has burnished his credentials by backing good causes, including a chinese university programme called schwarzman scholars and a new York Library building predictably also named after him.