TEXT-Fitch rates Blackstone Holdings Finance notes 'A+'

Aug 17 - Fitch Ratings has assigned the following ratings to two classes of
senior unsecured notes issued by Blackstone Holdings Finance Co. LLC:

--$400 million of 4.75% senior unsecured notes due February 2023, 'A+';
--$250 million of 6.25% senior unsecured notes due August 2042, 'A+'.

The notes are guaranteed by The Blackstone Group L.P. (Blackstone) and
Blackstone Holdings I, II, III and IV L.P., all of which have long-term Issuer
Default Ratings of 'A+' with a Stable Outlook. The notes can be called, at any
time at the issuer's option, subject to a make whole provision plus accrued and
unpaid interest. Blackstone will also be obligated to repurchase the notes in
the event of a change of control (defined as a sale or change in beneficial
ownership of Blackstone Holdings Finance Co. LLC and its guarantors) and a
downgrade of the notes below investment grade within 60 days of the change of
control.

Fitch believes the debt issuance will serve to replenish cash balances used in
the acquisition of Harbourmaster Capital Limited and the remaining 15% stake in
GSO Capital Partners, L.P. Both acquisitions are expected to add incremental
fee-related earnings-EBITDA (FEBITDA) in the second half of 2012 (2H'12) and in
subsequent years.

Blackstone's leverage, as measured by corporate debt divided by FEBITDA, was
1.43 times (x) at June 30, 2012 on a trailing 12 month (TTM) basis. Pro forma
for the debt issuance, leverage is expected to increase to approximately 2.3x on
a TTM basis, which is viewed as at the higher end of the range for the current
rating. Fitch expects leverage to come down over time as FEBITDA increases,
although leverage levels, and thus ratings, are sensitive to flattening or
declining FEBITDA.

The ratings of Blackstone reflect its competitive position as a global
alternative asset manager experienced management team, strong corporate culture,
solid investment track record, large institutional investor base, significant
fee-earning assets under management (FAUM), incentive income-generating
capability, ample liquidity, appropriate leverage levels, and subordination of
general partner interests to outstanding indebtedness.

RATING DRIVERS AND SENSITIVITIES

The Stable Outlook reflects Fitch's expectations that management will continue
to generate stable management and advisory fees, grow/retain FAUM through the
raising of new and expansion of existing funds, albeit at a more moderate pace,
operate with appropriate leverage levels, and retain a solid liquidity profile
in order to meet co-investment commitments to funds.

Declines in investment performance, a key man event, and/or legislative risk
which negatively impact the company's ability to raise FAUM and generate fees,
meaningful increases in leverage, and/or impairment of the liquidity profile
could result in negative rating action. Positive rating momentum is considered
relatively limited, given the nature of the business and the company's existing
risk profile.

Blackstone, a Delaware incorporated limited partnership, is a leading global
alternative investment manager specializing in private equity, real estate,
credit funds, fund of hedge funds, corporate advisory and restructuring, and
fund placement services. As of June 30, 2012, FAUM amounted to $157.6 billion
and total assets under management (AUM) were $190.3 billion. The company's stock
is listed on the NYSE under the ticker 'BX'.

Fitch currently rates Blackstone as follows:

The Blackstone Group L.P.
--Long-term Issuer Default Rating (IDR) 'A+;
--Short-term IDR 'F1'.

Blackstone Holdings Finance Co. L.L.C.
--Long-term IDR 'A+;
--Senior unsecured debt 'A+'; and
--Short-term IDR 'F1'.

Blackstone Holdings I, II, III, and IV L.P.
--Long-term IDR 'A+;
--Short-term IDR 'F1'.

The Outlook is Stable.

Additional information is available at 'www.fitchratings.com'. The ratings above
were solicited by, or on behalf of, the issuer, and therefore, Fitch has been
compensated for the provision of the ratings.

Applicable Criteria and Related Research:
--'Global Financial Institutions Rating Criteria' (Aug. 15. 2012);
--'Investment Manager and Alternative Funds Criteria' (Dec. 23, 2011).

Applicable Criteria and Related Research:
Investment Manager and Alternative Funds Criteria
Global Financial Institutions Rating Criteria