Tuesday, March 16, 1999

Bishop deal could reap $450 million

Estate will sell 9 million
shares of Goldman Sachs initially,
while keeping nearly 22
million shares

Jervis still at Castle Medical Center

By Rick Daysog


Bishop Estate will earn as much as $450 million when the Wall Street investment firm Goldman Sachs Group L.P. goes public later this year.

The estate will sell 9 million shares of Goldman Sachs in an initial public offering, the company said today in a Securities & Exchange Commission filing.

A specific date for the stock offering has not been set but previous reports have said it could happen as early as May.

The estate will retain roughly 21.9 million shares in Goldman, giving it a nearly 4.7 percent interest in 130-year-old company, according to the filing.

Based on the proposed $40 to $50 offering price, the estate's current stake in Goldman could be worth as much as $1.55 billion, or more than three times its initial $500 million investment in the company, Wall Street's richest private partnership.

Overall, Goldman said it plans to raise as much as $3.45 billion in the stock sale, the second-largest IPO of the 1990s after Conoco Inc.'s $4.4 billion sale in October.

The estate, which is Hawaii's largest private landowner and oversees Kamehameha Schools, initially invested in Goldman Sachs in 1992 when it acquired a 5 percent stake for $250 million. The trust bought an additional 5 percent stake for $250 million two years later.

The Goldman offering is the latest in a string of public offerings that have benefited the estate.

Last May, the estate's interest in Beverly Hills, Calif.-based PBOC Holdings Inc. rose $60 million when the parent of the 19-branch People's Bank of California went public.

The estate also received a $19 million windfall last March when Bermuda-based insurance company Mid Ocean Ltd. merged with competitor Exel Ltd.

The Goldman deal comes as state Attorney General Margery Bronster's lawsuit to temporarily remove several trustees for financial mismanagement is headed for trial later this month.

The trustees have cited the estate's successful investment in Goldman as evidence that the trust is not mismanaged.

Goldman Sachs canceled its plans to go public late last year amid sharp bond trading losses and turbulent market conditions.

The investment firm's profits tumbled 81 percent in its fiscal fourth quarter ended Nov. 27.

But it restarted the IPO process as its fortunes picked up in December with a recovery in stock and corporate debt markets.

The firm said today that profits before partners' pay and taxes rose 16 percent to $1.19 billion, while revenues rose 21 percent to $2.995 billion in the quarter ended Feb. 26.

The stock offering "will allow us to secure permanent capital to grow; to share ownership broadly among our employees now and through future compensation; and to permit us to use publicly traded securities to finance strategic acquisitions that we may elect to make in the future," Jon Corzine and Henry Paulson Jr., the firm's co-chairman, said in a statement.

Bloomberg News and Reuters news service
contributed to this report.

Jervis remains in
doctors’ care at Castle

By Rick Daysog


Bishop Estate trustee Gerard Jervis remains under doctors' care at Castle Hospital.

Five days after he was rushed from his Kailua home by ambulance when he overdosed on sleeping pills, Jervis is recovering at the hospital, his attorney Ronald Sakamoto said today.

Sakamoto said he spoke briefly to the 50-year-old Jervis last night. Sakamoto noted that Jervis and his wife, Avis, have been overwhelmed by the support from well-wishers.

Jervis took an overdose of sleeping pills last Thursday after estate lawyer Rene Ojiri Kitaoka apparently committed suicide the week before. The day before Kitaoka's apparent suicide, she and Jervis were discovered in a compromising situation by a security guard in a men's restroom at the Hawaii Prince Hotel in Waikiki.

Yesterday, the estate held a prayer service for its employees at Kawaiahao Church.

Bishop Estate Archive

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