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BORROWINGS | 9 Months Ended
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Sep. 30, 2014
BORROWINGS |
12. | BORROWINGS
On April 7, 2014, Blackstone Holdings Finance Co. L.L.C. (the “Issuer”), an indirect subsidiary of the Partnership, issued $500 million aggregate principal amount of Senior Notes maturing June 15, 2044 (the “Notes”). The Notes have an interest rate of 5.000% per annum, accruing from April 7, 2014. Interest is payable semiannually in arrears on June 15 and December 15 of each year, commencing December 15, 2014. The Notes are unsecured and unsubordinated obligations of the Issuer. The Notes are fully and unconditionally guaranteed, jointly and severally, by the Partnership, Blackstone Holdings I L.P., Blackstone Holdings II L.P., Blackstone Holdings III L.P. and Blackstone Holdings IV L.P. (the “Guarantors”). The guarantees are unsecured and unsubordinated obligations of the Guarantors. Transaction costs related to the issuance of the Notes have been capitalized and are being amortized over the life of the Notes. On May 29, 2014, the Issuer entered into an amendment to the $1.1 billion revolving credit facility (the “Credit Facility”) with Citibank, N.A., as Administrative Agent. The amendment, among other things, extended the maturity date of the Credit Facility from July 13, 2017 to May 29, 2019. As of September 30, 2014, Blackstone had no outstanding borrowings under the Credit Facility. The carrying value and fair value of the Blackstone issued notes, included in Loans Payable within the Condensed Consolidated Statements of Financial Condition, were:
|  | September 30, 2014 |  |  | December 31, 2013 |
|  | Carrying Value |  |  | Fair Value (a) |  |  | Carrying Value |  |  | Fair Value (a) |
Blackstone Issued 6.625%, $600 Million Par, Notes Due 8/15/2019 (b) |  | $ | 627,081 |  |  | $ | 694,688 |  |  | $ | 632,823 |  |  | $ | 684,860 |
Blackstone Issued 5.875%, $400 Million Par, Notes Due 3/15/2021 |  | $ | 398,667 |  |  | $ | 464,680 |  |  | $ | 398,543 |  |  | $ | 447,120 |
Blackstone Issued 4.750%, $400 Million Par, Notes Due 2/15/2023 |  | $ | 393,651 |  |  | $ | 433,280 |  |  | $ | 393,202 |  |  | $ | 415,760 |
Blackstone Issued 6.250%, $250 Million Par, Notes Due 8/15/2042 |  | $ | 239,832 |  |  | $ | 307,725 |  |  | $ | 239,738 |  |  | $ | 278,550 |
Blackstone Issued 5.000%, $500 Million Par, Notes Due 6/15/2044 |  | $ | 492,988 |  |  | $ | 518,300 |  |  | $ | — |  |  | $ | — |
(a) | Fair value is determined by broker quote and these notes would be classified as Level II within the fair value hierarchy.
(b) | The carrying and fair values are determined using the original $600 million par amount less $15 million attributable to these notes which were acquired but not retired by Blackstone during 2012.
Included within Loans Payable and Due to Affiliates within the Condensed Consolidated Statements of Financial Condition are amounts due to holders of debt securities issued by Blackstone’s consolidated CLO vehicles. Borrowings through the consolidated CLO vehicles consisted of the following:
|  | September 30, 2014 |  |  | December 31, 2013 |
|  | Borrowing Outstanding |  |  | Weighted- Average Interest Rate |  |  | Weighted- Average Remaining Maturity in Years |  |  | Borrowing Outstanding |  |  | Weighted- Average Interest Rate |  |  | Weighted- Average Remaining Maturity in Years |
Senior Secured Notes |  | $ | 5,460,411 |  |  |  | 1.03 | % |  |  | 3.5 |  |  | $ | 8,605,553 |  |  |  | 1.09 | % |  |  | 4.1 |
Subordinated Notes |  |  | 734,206 |  |  |  | (a | ) |  |  | N/A |  |  |  | 1,221,068 |  |  |  | (a | ) |  |  | N/A |
|  | $ | 6,194,617 |  |  |  |  |  |  |  |  |  |  | $ | 9,826,621 |  |  |  |  |  |  |  |  |
(a) | The Subordinated Notes do not have contractual interest rates but instead receive distributions from the excess cash flows of the CLO vehicles.
Senior Secured Notes and Subordinated Notes comprise the following amounts:
|  | September 30, 2014 |  |  | December 31, 2013 |
|  |  |  |  | Amounts Due to Non- Consolidated Affiliates |  |  |  |  |  | Amounts Due to Non- Consolidated Affiliates |
|  | Fair Value |  |  | Borrowing Outstanding |  |  | Fair Value |  |  | Fair Value |  |  | Borrowing Outstanding |  |  | Fair Value |
Senior Secured Notes |  | $ | 5,322,648 |  |  | $ | 4,500 |  |  | $ | 4,367 |  |  | $ | 8,302,572 |  |  | $ | 14,500 |  |  | $ | 13,732 |
Subordinated Notes |  | $ | 360,272 |  |  | $ | 40,059 |  |  | $ | 23,218 |  |  | $ | 610,435 |  |  | $ | 224,444 |  |  | $ | 110,197 |
The Loans Payable of the consolidated CLO vehicles are collateralized by assets held by each respective CLO vehicle and assets of one vehicle may not be used to satisfy the liabilities of another. As of September 30, 2014 and December 31, 2013, the fair value of the consolidated CLO assets was $7.5 billion and $9.5 billion, respectively. This collateral consisted of Cash, Corporate Loans, Corporate Bonds and other securities. Scheduled principal payments for borrowings as of September 30, 2014 were as follows:
|  | Operating Borrowings |  |  | Blackstone Fund Facilities/CLO Vehicles |  |  | Total Borrowings |
2014 |  | $ | — |  |  | $ | — |  |  | $ | — |
2015 |  |  | — |  |  |  | 6,823 |  |  |  | 6,823 |
2016 |  |  | — |  |  |  | — |  |  |  | — |
2017 |  |  | — |  |  |  | — |  |  |  | — |
After 2018 |  |  | 2,135,000 |  |  |  | 6,194,617 |  |  |  | 8,329,617 |
Total |  | $ | 2,135,000 |  |  | $ | 6,201,440 |  |  | $ | 8,336,440 |

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 19, 20, 22 -Article 5 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.19,20,22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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