Blackstone raises record $21.7B fund

Private equity titan closes on world's largest private equity fund, despite concerns over industry's future.

By Grace Wong, CNNMoney.com staff writer

LONDON (CNNMoney.com) -- Blackstone Group has raised the largest private equity fund ever, despite a chill in the debt markets that has cast uncertainty over the buyout industry's rapid growth.

Blackstone said Wednesday it raised $21.7 billion for its latest fund, Blackstone Capital Partners V. That surpasses the $20 billion fund Goldman Sachs (Charts, Fortune 500) raised earlier this year.

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Blackstone CEO Stephen Schwarzman cites 'gratifying' vote of confidence from investors.

Shares of Blackstone (Charts) gained about 3 percent in morning trading.

The announcement comes as faltering debt markets have put the brakes on the buyout boom and raised worries over whether take-private deals will dry up further down the road.

"This further vote of confidence from our investors is extremely gratifying. The record-breaking amount of capital at our disposal allows us to continue our leadership role in private equity investing on a global basis," CEO Stephen Schwarzman said in a statement.

Blackstone said two-thirds of the fund's available capital has been committed to deals already announced, including the buyout of Hilton Hotels (Charts, Fortune 500). The fund will be invested across a variety of sectors and regions.

Blackstone has raised about $67 billion since 1987. The company made a spectacular market debut in June, although shares have fallen about 19 percent in the last month. Top of page