Monday, June 15, 1998

Goldman, Sachs to
offer public stock

Bishop Estate,
a 10% owner, stands to gain
hundreds of millions

By Star-Bulletin staff and wire report


NEW YORK -- Goldman, Sachs & Co., Wall Street's most profitable investment firm, which is partly owned by Hawaii's Bishop Estate, is ending its 129-year partnership and will issue shares to the public in a move to better compete with its publicly traded rivals.

Goldman Sachs' executive committee decided unanimously to propose the initial public stock offering, and its partners expressed overwhelming support for the idea over the weekend, said a statement released today.

Bishop Estate owns about 10 percent of Goldman Sachs, and the public offering would likely generate hundreds of millions of dollars for the estate.

After rejecting such a move at least six times in the past 20 years, Goldman finally took the plunge, with its 190 partners expressing "overwhelming support" for a proposal to go public at the annual meeting Friday and Saturday, Goldman said.

The shares probably will be offered this fall and represent 10 percent to 15 percent of the firm's stock.

Goldman has been thriving as a traditional investment bank that focuses on trading, underwriting and providing advice to corporations, governments and wealthy clients.

It had profits of $1 billion in the first quarter alone and more than $3 billion last year.

But the firm's viability as a private partnership had come into question as Depression-era restrictions separating brokerages, banks and insurance companies crumble and spark a merger boom that is changing the face of the financial services industry.

A public offering would give Goldman currency to buy other companies and strengthen areas where it is weak, leveling the field with rapidly growing competitors.

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