Billionaire Steve Schwarzman may have to wipe the egg noodle off his face after invoking post-atom bomb Japan when trying to describe one of his Blackstone Group’s failed deals.
At an investor conference in Boca Raton, Fla., last week, the buyout king was trying to explain the firm’s failed deal to buy mortgage lender PHH Corp. for $1.7 billion in the midst of the credit crisis.
Schwarzman at first earnestly said, “No one in the world would lend us money. It is the first time we haven’t performed.”
But then he sent jaws dropping by explaining: “Trying to buy a mortgage bank in the midst of the subprime crisis was the equivalent of being a noodle salesman in Nagasaki when the atomic bomb went off. Not a lot of noodles left or even a person – and that’s what happened to us on this deal.”
Oops.
Blackstone, which recently opened up a Tokyo office, declined comment.
But the newsletter Private Equity Insider, which broke the news of Schwarzman’s comments, speculated that the off-the-cuff remarks could hurt the firm’s ability to do business in Japan.
Blackstone has deep ties to Asia. Before the private-equity giant went public last year, China’s Citic Securities paid $3 billion for 10 percent of the firm.
At least Schwarzman has company. At a conference in Philadelphia in January, Carlyle Group’s David Rubenstein suggested a protestor “take a remedial course in English” before speaking out again. He later apologized.